India Calls For Permanent Solution To Food Stockholding At WTO's 13th Ministerial Conference In February 2024

A Geneva-based Indian government official said India has dismissed arguments for alternative food security solutions beyond PSH (public stock holding) and SSM (special safeguard mechanism)

The upcoming 13th Ministerial Conference of the World Trade Organization (WTO), is scheduled to be held in Abu Dhabi, United Arab Emirates in the week of February 26, 2024.

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India has called for finding a permanent solution to the issue of public stockholding for food security at the ministerial-level meeting of the World Trade Organisation (WTO), scheduled to be held in Abu Dhabi in February 2024, reported PTI. According to the report, a Geneva-based Indian government official said India has dismissed arguments for alternative food security solutions beyond PSH (public stock holding) and SSM (special safeguard mechanism). 

It believes that market access and export restriction are not worth the effort, the official said.

"India declared that it has no intention of revising the existing proposal for public stockholding for food security purposes and suggested that it is the only way forward. India called for a permanent solution for PSH at MC13 (13th ministerial conference)," the official said.

During a recent special session of the WTO's Committee on Agriculture held on May 3 and 4 in Geneva, India also pitched for the recalculation of external reference prices to account for the impact of inflation and other economic factors on food stock prices, the report said. 

"India criticized non-proponents for their stubbornness and unwillingness to move from old positions when negotiations begin to discuss details," the official added.

The upcoming 13th Ministerial Conference of the World Trade Organization (WTO), which serves as the top governing body of the organization with 164 member countries, is scheduled to be held in Abu Dhabi, United Arab Emirates in the week of February 26, 2024.

According to the report in WTO's Committee on Agriculture meeting held on May 3 and 4,  China, India, Sri Lanka, South Africa, and Egypt joined the call for initiating text-based negotiations on PSH. They highlighted the importance of PSH being applied to all developing countries, particularly least-developed countries (LDCs) and net-food importing developing countries (NFIDCs), to help address the severe food security problem.

India has requested amendments to the formula used to calculate the food subsidy cap and the inclusion of post-2013 programs under the 'Peace Clause' as part of a permanent solution. The Bali ministerial meeting in December 2013 established the Peace Clause as an interim measure and committed to negotiating a permanent solution. The Peace Clause allows developing nations to exceed the prescribed ceiling without challenge in the dispute settlement forum of the WTO. This clause will remain in effect until a permanent solution is found for the food stockpiling issue.

According to global trade regulations, a member country of the WTO is not allowed to exceed a food subsidy cap of 10 per cent of the value of production, based on the reference price of 1986-88. Any subsidies above this limit are considered to distort trade. This ceiling is set at 10 per cent for developing countries such as India.

In order to meet the domestic food security needs of its impoverished population, India has utilized the peace clause to provide extra support measures to rice farmers for the 2020-21 marketing year. India has also requested a Special Safeguard Mechanism (SSM) to protect small and marginalized farmers from sudden surges in imports or significant declines in prices.

The report noted that at the 12th ministerial conference in Geneva, despite making progress on the food security front, members were unable to arrive at an agreement on the agriculture reform work plan. 

The WTO is an international organization consisting of 164 member countries that regulate global trade and sets standards for exports and imports. In addition to establishing trade rules, the WTO also resolves trade disputes between member countries. Agriculture negotiations within the WTO cover a range of topics, such as domestic support, market access, export competition, export restrictions, cotton, public stockholding for food security, special safeguard mechanism, and transparency issues.