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India to sign TFA: positives and negatives

What does it mean for India's food stockholding schemes and will the stringent norms affect India

Nayanima Basu  |  New Delhi 

India is all set to sign the Trade Facilitation Agreement (TFA) at WTO's special General Council (GC) meeting in Geneva today. The TFA aims at easing global customs rules for smoother and easier movement of goods across international borders. India vetoed signing the deal in July this year. However it seems to have agreed now that the government has reached an understanding with the US which has promised to support its demand for a permanent food 'Peace Clause' until a definitive solution to public stockholding schemes is achieved by the WTO.

Here are the positives and negatives once India signs the TFA


1. Industry will save transaction costs that runs into billions of dollars for exporting their products in the international markets.

2. Indian exporters will be able to achieve greater access in some of the difficult markets like US, Europe, Japan & China that have stringent customs rules and regulations.

3. Indian small and medium enterprises (SMEs) will be the biggest beneficiaries as they will now be able to spend more on marketing their products than spending time and money on tedious paperwork that result in inordinate delays.


1. India will lose a major bargaining power before it achieves a permanent solution on the food security issue. It is believed that once the developed countries obtain the TFA, they will not expedite talks on public stockholding issue, which is in fact India's main goal.

2. To have a permanent food security 'Peace Clause', India will have to adhere to some stringent riders to avail the provision. Farmers & civil society activists fear these stringent riders will result in disastrous consequences.

3. India's main demand of having a permanent solution to the food security issue might get delayed forever. Achieving a permanent solution to the food stockpile issue entails amendment of the WTO Agreement on Agriculture.

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First Published: Wed, November 26 2014. 11:18 IST