India making its stand clear and insisting on its right to continue with the food subsidies to its poor millions and American stand on customs duty has made the much needed meaningful deal under the World Trade Organisation (WTO) static and the search is on to find a way out of the impasse. India has taken a stand on streamlining of custom duties worldwide which developed nations including America, UK etc find against their trade practices. The uniform custom duties and streamlining the process would check to some extent the dumping policies adopted by the developed nations to keep their economies going strong. When you have a variable customs duty poor nations are the fertile dumping grounds for their produces thus maintaining a trade balance in their favour.US is emphasising for the early settlement of WTO issues so that Trade Facilitation Agreement (TFA) could be inked. India expected an early deal on food subsidies after the Bali agreement signed in 2013 which contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. It further contains provisions for technical assistance and capacity building in this area. But till date West has not responded to it and maintained a stoic silence. After 2017 India would be penalised heavily for its subsidy programme. Now the heat will be on WTO members particularly from the developed nations to speed up negotiations on the food subsidy issue which is what India has been asking for. The current WTO norms limit the value of food subsidies at 10 per cent of the total value of foodgrain production. However, the Minimum Support Prices (MSP) is calculated at the prices that are over two decades old. India is asking for a change in the base year (1986-88) for calculating the food subsidies. Even if, India agrees that shift would take years to finalise politically.
