• UGI USER
  • Feb 15, 2024
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WTO PRESSURE ON INDIAN FARM SUBSIDIES

Why in the News?

  • India faces pressure at the WTO regarding its farm subsidies amid protests for a legal minimum support price (MSP).
  • The Cairns Group, including Australia, Brazil, and Canada, alleges India’s public stockholding (PSH) program distorts global food prices and harms food security in other countries.
Source: Slide Serve

India’s Stand and Demands:

  • India seeks better legal protection for its MSP program to withstand pressure at the WTO.
  • While India benefits from the ‘Peace Clause’ protection, ambiguity in its provisions leaves room for disputes, prompting India to seek a permanent solution.
  • India’s demands at the ministerial meeting include amending subsidy caps and expanding the ‘Peace Clause’ to cover programs introduced after 2013.
About Minimum Support Price (MSP)

·    MSP guarantees farmers a set price for their produce when sold to the government.

·    Determined by the Commission for Agricultural Costs and Prices (CACP), considering factors like production cost, market trends, and demand-supply dynamics.

·    CACP, established in January 1965, operates under the Ministry of Agriculture and Farmers Welfare.

·    Final approval on MSP levels is made by the Cabinet Committee on Economic Affairs (CCEA), chaired by the Prime Minister of India.