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India raises Peace Clause as it stands behinds its farmers

India has sent a clear message with this move that to will firmly stand beside its farmer and will ensure that they do not face any discrimination in the market and help the economy to recover from the pandemic.

Saumy Deepak Tripathi

India has invoked the peace clause of the World Trade Organisation to extend the ceiling to its farmers who grow rice. This move has raised a strong objection from developed economies like the US and the EU. The peace clause exempts the country which invoked it from sanctions of the WTO.

The move was not unexpected as the WTO has always been a battlefield between the developing and developed countries. The developed countries have accused the developing countries of providing an excess subsidy that puts its farmer at a disadvantage in terms of foreign trade. The developing countries have rightly countered this by saying that majority of the farmers in their country practice Agriculture more as a means of subsistence rather than a profitable venture.

India has announced that its drive production in 2019-20 at $ 43.67 billion and India is offering a subsidy of $ 5 million which is excess according to the rules of WTO as member countries can provide subsidy to only 10 % of the total production.

The move will cause a stalemate as only a few days ago the countries had agreed to remove bad subsidies on fisheries from their process but failed to agree on what constitutes a bad subsidy.

The flare-up is not new the Indian government has been vouching for more rights for the developing countries which it feels are subjected to bias behavior by the organization. The move is also seen as India’s attempt to protect its farmer as the Agriculture sector has now become a key cog in the economic recovery of the nation and also to increase its stock as it looks to minimise the risk of food shortage during the pandemic. The sector has posted positive figures even when other sectors faltered due to COVID-19.

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