India will challenge the World Trade Organisation’s (WTO) decision on the matter of sugar export subsidies. The WTO dispute settlement panel in December ruled that India’s domestic support measures for the production of sugar and sugarcane were inconsistent with international agreements governing trade and agriculture.
The Indian government said that it would be appealing the decision as the findings made in the report were “erroneous”.
“The panel issued its report on December 14, 2021 in which it has made certain erroneous findings about our schemes to support sugarcane producers and exports. The findings of the panel are completely unacceptable to India. The panel’s findings are unreasoned and not supported by the WTO rules. The panel has also evaded key issues which it was obliged to determine. Similarly, the panel’s findings on alleged export subsidies undermine logic and rationale,” stated an official release issued by the Commerce Department.
What was the dispute about?
The report from the dispute settlement body found that India’s subsidies to sugarcane producers exceeded the 10 percent limit as set by the WTO under the Articles on Agriculture (AoA), between 2014-15 and 2018-19. Additionally, India was found to be in contravention of the SCM Agreement and other articles within the AoA, through its various export schemes and subsidies for sugar mills like the Production Assistance, the Buffer Stock, and the Marketing and Transportation Schemes.
What does the ruling mean?
As such, the WTO ruling does not affect India much currently.
India will dispute the findings in the appellate body of the WTO dispute settlement panel, but that may take longer than expected. The US has been blocking the appointment of judges to the appellate body, which is the final body where such matters are taken up, for the previous three years. Without its judges, the appellate body has not been able to take up any cases that are pending before it.
(Edited by : Thomas Abraham)