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Home > Business > PTI > Report

Poor nations pleased with WTO agri draft

Dhananjay Mahapatra in Tokyo | February 14, 2003 13:59 IST

The World Trade Organisation draft proposal on agriculture have come as a shot in the arm for developing countries with many of them in the mini-ministerial in Japan terming it as a small victory and that it addressed some of their long standing objections in opening up the farm sector.

The latest draft by chairman of the WTO Committee on agriculture Stuart Harbinson proposed that the developing countries could gradually cut customs duty on agri-products over a negotiated period and continue the state subsidy and extraordinary support.

But it has come as a jolt to many of the developed countries, including Japan and European Union, which have opposed the drastic reduction of farm subsidy.

Delegates from developing countries, including those from India, Kenya and Nigeria said that it could be viewed as a small victory for the strong stand taken by the developing countries at Doha Ministerial against opening up of their agri-market without addressing the prevailing social conditions.

Though India welcomed the draft modalities giving concessions on the state subsidy and special product exemption front, it would oppose the reduction in the tariff structure as proposed within a period of 10 years, official sources said.

The developing countries consider the draft as an important document as it has attempted to take on board the differing views of three major trading blocks - CAIRNS, EU and the developing countries - over the contentious issue of market access in agriculture sector.

The CAIRNS countries - including US, Australia, New Zealand, Malaysia, Indonesia, Brazil, Thailand and Canada - being agri-export countries, advocate free market access. Many of these countries have hidden subsidies to boost their agriculture sector.

EU, which gives huge subsidies to the agriculture sector, supports market access but does not agree linking this to reduction in subsidy.

Developing countries fear that their markets will be flooded with products from other countries, which are cheap due to massive state support, causing unrest and social tension among the population dependent on this for their livelihood.

Explaining the Indian position, the official said 65 per cent of the Indian population was dependent on agriculture and the government views this sector as a means to eliminate rural poverty.

Moreover, the total subsidy given by the government through smaller supports in electricity tariff, fertiliser prices and transportations was lower than the WTO benchmark on subsidy.

Viewed in this backdrop, the draft modalities proposed by the WTO Committee on Agriculture comes at an opportune time.

India said that its interests in some key areas had been further protected by the proposition in the draft under the Special Product Exemption category where it could maintain its present tariff.

© Copyright 2003 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.



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