21-The Dispute About Sugar Subsidies At WTO

1. The Dispute About Sugar Subsidies At WTO The Dispute About Sugar Subsidies At WTO Located in Asia, India is the largest sugar producer and second-largest sugar exporter in the world. The Asian nation ranks behind Brazil in global sugar trade and bumper sugar production helps the country export bulk sugar every year. Initiatives and efforts by the government have played a crucial role in enhancing the lives of sugarcane farmers and Sugar Exporters of the nation and this has been the reason for the dispute of late at the World Trade Organization (WTO). In 2019, Brazil submitted a complaint against India at the WTO alleging the latter that its sugar subsidies were inconsistent with the trade rules of the organization. Wh What is World Trade Organization? at is World Trade Organization? The WTO (World Trade Organization) is an international organization that supervises and liberalizes international trade between nations. Established on the 1st of January, 1995 it succeeded the General Agreement on Tariffs and Trade (GATT). Currently, more than 160 countries that represent 98% of the world trade are a part of the WTO and unlike other organizations, all decisions at the WTO are resolved through consensus. Disputes are resolved via bilateral consultation and in case both sides are unable to resolve the matter, they can approach the Dispute Settlement Panel. The panel’s report can be challenged by either of the sides before an Appellate Body and its decision is considered to be final in all regards. Current Sugar Dispute

2. Currently, the sugar dispute we are referring to is the one raised by Brazil back in 2019. Back then, it raised a complaint against India at the WTO that its sugar subsidies were inconsistent with the trade rules of the organization. Brazil was unhappy with GOI’s efforts with minimum prices of sugarcane and sugar, Fair and remunerative prices (FRP), Minimum Indicative Export Quota (MIEQ) and Specific Indian states enforcing higher minimum prices. Brazil argued that these sugar subsidies incentivized Indian sugarcane farmers and were the reason behind increased domestic production which led to rise in inventory and lower prices of the sweetener in the global market. WTO’s Decision WTO’s Decision The WTO formed a panel to study the allegations made by Brazil against India and the organization submitted its report in 2021. In its report, it concluded that India was providing ‘lump sum assistance’ to sugarcane producers and it asked India to withdraw its export subsidies within 120 days of circulation of the report. India’s Defence India’s Defence India in its defense stated that the panel’s findings are unreasonable and unsupported by the WTO rules. Clarifying its stance, it said that the schemes are meant to support sugarcane producers and domestic exports and are well within the obligations of the WTO agreements. In January 2022, it made an appeal at the WTO’s appellate body against the rulings of the panel commenting that the panel committed “gross errors” while reaching at the conclusion. This dispute is yet to be resolved and India is in negotiations with Brazil to talk this out. If you are a sugar exporter looking to export bulk sugar or are a Sugar Importer looking to import bulk sugar, then Tradologie.com is the platform for you. Tradologie has over 600,000 verified buyers and 70,000+ verified suppliers in its network and through the platform, you can connect and conduct bulk trade of food and agro-commodities with ease. To register as a seller, click here. To register as a buyer, click here. To stay updated with the recent happenings of the agro-trade industry, do follow Tradologie across all social media channels.