US lawmakers seek litigation at WTO against India on wheat subsidy

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Top American lawmakers have urged the Joe Biden administration to initiate a litigation process at the World Trade Organisation against India subsidising its farmers over half of the value of production for wheat.

US Wheat Associates, which has been aggressively pushing for such a move by the administration, has welcomed the letters by members of the Congress and Senate.

A group of 28 members of the US Congress, in a letter, said, “American commodity producers are operating at a clear disadvantage to their competitors, primarily from India, where the government is subsidising more than half of the value of production for rice and wheat, instead of the 10 per cent allowable under World Trade Organisation (WTO) rules.”

“We ask that you swiftly take action to reverse the trend of non-compliance by India with WTO domestic support requirements by initiating a dispute settlement case,” stated the letter to US Trade Representatives Katherine Tai and Agricultural Secretary Tom Vilsack.

The Congress members wrote the US has continually pressed India at the WTO to reform its price support programme but to no avail.

“Considering India’s activity, we encourage you to initiate the WTO litigation process through a request for consultations,” they said.

The letter by the members of the Congressmen on January 13 comes nearly a month after 18 Senators sent a similar letter to Vilsack and Tai requesting the Biden administration pursue WTO case against India’s domestic support for rice and wheat production.

The US has previously highlighted India’s non-compliance through counter-notifications at the WTO Committee on Agriculture.

Reacting to the move by the lawmakers, US Wheat Associates, in a statement, said it was “pleased that several members of Congress have asked Secretary of Agriculture Tom Vilsack and US Trade Representative Katherine Tai to pursue a WTO case against India’s trade-distorting domestic wheat and rice support.”

National Association of Wheat Growers CEO Chandler Goule said it is important that as a WTO member, India must adhere to international commitments and not continue to create unfair advantages for its domestic production and distort world trade.

“We appreciate these Senators bringing the issue to the attention of the administration and will continue to work with the United States Department of Agriculture (USDA) and United States Trade Representative (USTR) in enhancing the competitiveness of US wheat in the world,” he said.

USDA estimates Indian wheat exports for the marketing year ending June 30, 2022, will be 5 million metric tons (MMT).

“This leaves almost 28 MMT of wheat stocks remaining. The distortion of international wheat and rice trade from these policies is severe, costing US wheat farmers more than $500 million per year in lost income according to a 2020 Texas A&M University study commissioned by USW and USA Rice,” according to a media release.

 

The Indian Express

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