EU asks India about double farmers’ income at WTO

Massive farm-support plans in the United States and India are being scrutinised by other World Trade Organization (WTO)  members, questions submitted to the WTO’s quarterly agriculture committee meeting.

The WTO has strict rules about the size and nature of payments, and member governments keep a close watch for any competitors who might be cheating. Their questions — 62 pages for the June 25-26 meeting — can range from requests for clarification to outright allegations of illegal handouts.

US President Donald Trump and Indian Prime Minister Narendra Modi have both made boosting farm incomes a priority. Trump is trying to offset domestic damage from a tariff war with China; PM Modi faces a slowdown in India’s agriculture-dominated economy.

The European Union asked India to explain how PM Modi proposed to spend 25 trillion rupees (USD 357.5 billion) on agriculture and rural development, doubling farmers’ incomes by 2022 as part of a 100 trillion-rupee, five-year infrastructure splurge.

“How will this be done, taking into account global market prices of produce and measures put in place to prevent excess production?” the EU asked. The United States queried India’s 5 per cent export subsidy for non-Basmati rice and its growing state buying of wheat at rising prices, despite back-to-back record harvests, noting that it was on track for a record wheat stockpile.

The United States and Australia also wanted details of India’s new “transport and marketing assistance” for agriculture, which Australia said was an export subsidy that should be phased out.

India criticised the US 2018 Farm Bill, saying it benefited not only farmers, but also their first cousins, nieces and nephews, with children and spouses qualifying for USD 125,000 of payments.

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