India has challenged a major flexibility given to developed countries whereby they can concentrate their subsidies on a few farm products which allows them more policy space and causes distortions in global agricultural trade.
India and China have jointly prepared a paper in which they have argued that the subsidies given under this flexibility by developed members including the US, EU and Canada amounts to nearly $160 billion, which is more than 90% of the total global entitlements resulting in a major asymmetry in the rules on agricultural trade.
The paper, which was circulated in the World Trade Organization (WTO) on July 17, stresses on the need to eliminate this flexibility as a pre-requisite for consideration of other reforms in domestic support negotiations.
The paper has cited examples where the product support given by developed countries exceeded even the value of production in some years. Subsidies to mohair and wool by the US; tinned pineapple, cotton and tobacco by the EU while the subsidy dole out by Canada to tobacco in 2009 was more than thrice the value of production.
The subsidies here are called the Aggregate Measurement of Support, or AMS, which is the annual level of support or subsidies expressed in monetary terms. The subsidy can be for a particular agricultural product in favour of the producers (product specific) or it can be given to farmers in general. Hence, the subsidy on any product can be as high as the total support.
India is expected to import up to 4 million tonnes of wheat this fiscal year, despite a bumper harvest, due to the cheaper availability of the commodity in the international markets.
Rajiv Yadav, vice president at COFCO Agri, said: Depending on how the monsoon progresses, India is likely to import about 3 to 4 million tonnes of wheat until April.
Despite erratic weather, cotton sector is confident of an increase of about 12% in production in 2017-18 as farmers are not interested in sowing pulses and soyabean. Industry has pegged cotton production estimate at 380 million bales against 340 million bales produced last year.
Sandeep Bajoria, chairman, All India Cottonseed Crushers' Association said, We expect India's 2017-18 cotton production to be more by about 10% to 12% this year. It may hit 380 million bales from 340 million bales of previous year.
The area sown as on July 14 was 90.88 lakh hectare, up by 17 % from 73.93 lakh hectare sown on the corresponding date of previous year. Most of the cotton sowing has been over now as cotton sowing after July 15 is not advised by research institutes.
The industry has played down deficient rainfall in parts of cotton growing areas of Maharashtra, Telangana and Karnataka, claiming it will not have major impact on the production estimates.