Developing nations at WTO bat for public stockholding & distribution of foodgrains

The African group of nations, along with some other developing country members, are lobbying to approve public stockholding of foodgrains for food security purposes by both developing countries and least developed countries as a permissible action under the World Trade Organisaiton (WTO) rules. The move comes in the backdrop of Prime Minister Narendra Modi saying India can provide foodgrains to the world if the WTO rules permit.

In a proposal submitted for consideration among WTO members on May 31, members of the African Group, the ACP (African, Caribbean and Pacific Countries) and G33 (a coalition of developing countries including India), say the WTO should permit a developing country member to export from acquired stocks for the purposes of international food aid.

The permission should also be granted for non-commercial humanitarian purposes, or when requested by net food-importing developing countries and least developed countries in the same geographic region.

The WTO can also consider granting permission for any other region or any member facing food shortages and higher food inflation during international food crisis, they say.

The proposal says that programmes for public stockholding for food security purposes should include acquisition of foodstuffs at administered prices by the government in developing country members or least developed country members.

The objective is to support low-income or resource-poor producers and the acquisition of foodstuffs at administered prices by governments and subsequent distribution at subsidised prices to meet food security requirements of urban and rural poor and maintain adequate foodstock and ensure price stability.

As a safeguard measure, the proposal says any WTO member, which has reason to believe that a developing country member benefitting from this decision has not met the pre-fixed conditions, may request consultations. The Dispute Settlement Understanding (DSU) will apply to such consultations and consequent settlement of disputes under this decision, the proposal says.

The proposal adds the Aggregate Measurement of Support (AMS) will be calculated based on the actual quantity of foodstuffs acquired at administered prices and the external reference price (ERP). The ERP can either be the three-year average price based on the preceding five-year period, excluding the highest and the lowest entry for that product or a price adjusted for excessive inflation based on a pre-determined methodology.

The proposal has come when the WTO members have intensified work on achieving outcomes in agriculture that would respond to the looming food crisis and advance agriculture reforms. The WTO’s all powerful decision making 12th Ministerial Conference (MC12) is to happen from 12th to 15th June 2022.