India’s new support programme for sugar sparked comment among a number of delegations with some urging India to remove immediately what they described as export subsidies that will potentially impact world trade, when WTO members met today in the Agriculture Committee.

They discussed on one of 31 sets of questions and answers, a key part of the agenda of the committee, whose major responsibility is to oversee the present Agriculture Agreement and members’ commitments in agriculture.

Along with the facts and figures they sought, some of them asked what the legal basis under the WTO was for the export subsidies. Several pointed out that India has agreed not to subsidize exports.

India said the policy is designed to encourage diversification away from white sugar to raw sugar and that no intervention payments have been paid yet. India also said export subsidies will be notified to the WTO.

Australia said the IRs 3,300 per tonne incentive payment is the equivalent of 14 per cent to 16 per cent of the world price. Since India is the third largest exporter of sugar it threatens to seriously distort trade, Australia said, asking India to remove export subsidies immediately. It said that the amount envisaged could potentially finance all its own exports half way across the Pacific Ocean.

The Agriculture Agreement allowed developing countries to subsidise marketing costs and internal transportation costs during the agreement’s ‘implementation period’.

Likewise, Brazil asked how India could justify the subsidies since there has been no consensus to extend these special provisions for developing countries.

Apart from India’s sugar programme, Costa Rica’s on-going breach of its domestic support limit resulting from its guaranteed rice prices, Thailand’s rice support programme known as ‘paddy pledging’, Canada’s reclassification of pizza toppings to prevent traders avoiding import duties, and India’s domestic support for rice and wheat and its food security programme were also discussed.

The members also continued their work on implement the decisions and a declaration from the December 2013 Bali Ministerial Conference. They shared information of members and their policies, including the latest US Farm Bill, and trends in trade and agricultural trade policies.

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