'India's farm subsidy well below WTO cap of 10%'

India's farm subsidies are well below the WTO's cap of 10 per cent and the developed world should move ahead with finding a permanent solution for stock piling of grains for food security purposes, an official said.
According to a WTO filing, India has given a total farm subsidy of USD 56 billion, of which trade distorting subsidy amounts to only USD 13.8 billion for 23 commodities, including rice and wheat.
Explaining India's position, the official said the food subsidy provided by the Indian government for paddy during 2010-11 worked out to be only around 6 per cent of the total output of the commodity in value terms.

In case of wheat, the subsidy is negative one per cent.
The US and other WTO members have strongly criticised India for not notifying its farm support for a long time.
"The US and other developed countries have alleged that India is not notifying its agri subsidies because it has breached the 10 per cent cap. But now we have filed the notification to the WTO for seven years (2004-2005 to 2010-2011).

"It has completed its obligations and India is well below and within the de minimis level (10 per cent ) for all its major crops. Now there is no excuse with the developed world to engage with India in finding a permanent solution for its food security issues," the official said.

The subsidy filing would help India in pushing for finding a permanent solution for its public stock holding for food security purposes.
India has asked WTO to amend the norms for calculating agriculture subsidies so that the country could continue to procure foodgrains from farmers at minimum support price and sell them to poor at cheaper rates without violating the norms.
The current WTO norms limit the value of food subsidies at 10 per cent of the total value of food grain production. However, the quantum of subsidy is computed after taking into consideration prices that prevailed two decades ago.

The WTO has resumed work at Geneva from September 1 after a month long vacation.
India had decided not to ratify WTO's Trade Facilitation Agreement (TFA), which is dear to the developed world, without any concrete movement in finding a permanent solution.