WTO panel order will not impact the sugar industry (ISMA)

The sugar industry has said that the latest WTO panel order on Indian sugar exports will have no impact as there are currently no export subsidies.

“The Indian Sugar Mills Association (ISMA) is convinced that the government’s current sugar export policies and related subsidies, which have been granted in recent years, comply with the rules of the WTO and that there will therefore be absolutely no impact on Indian sugar mills or sugar cane producers, ”said the industrial body in a statement.

On December 14, a World Trade Organization (WTO) panel ruled against India’s sugar export subsidies and domestic support to sugar cane producers in a dispute filed by Australia, Brazil and Guatemala. But, the Commerce Department issued a statement asserting that the panel’s findings would have no bearing on India’s existing and ongoing policy actions in the sugar sector.

ISMA also said the government has already rejected the WTO panel’s findings and decided to appeal to the WTO Appeal Authority.

Read also: WTO Panel Rules Against Indian Sugar Export Subsidies

“First and foremost, as soon as the Indian government submits an appeal to the appeals authority, in accordance with WTO rules, current subsidies and domestic market support can be maintained until any final decision be taken by the appeal authority, “said the industry body.

In addition, the export subsidies granted in recent years comply with the provisions of Article 9.1 (d) and (e) of the Agreement on Agriculture under WTO rules, and by therefore, India’s sugar export subsidies are in full compliance with the rules. and may not need changes, ISMA said. WTO rules allow domestic market support for any product, including sugar and cane, with the government able to support the market up to 10 percent of the product’s value, he said. .

The panel report will be adopted by the WTO Dispute Settlement Body (DSB) within 20 to 60 days of its circulation, unless the DSB decides by consensus not to adopt it or one of the parties notifies its decision to appeal. Given that India is considering appealing, it is likely to be a protracted dispute.

Currently, world sugar prices are higher due to lower production and supply issues and despite this, Indian exports in the 2021-22 season (October-September) are expected to decline to around 6 million tonnes (mt) against a record 7.1 mt the previous season.

Rachel J. Bradford