Australia seeks clarity on agri infra fund, cotton subsidies

India’s Agriculture Infrastructure Fund (AIF) and cotton subsidies have come under scrutiny at the World Trade Organization (WTO), with Australia seeking clarity on the scope of the fund and confirmation that New Delhi has not exceeded its 10% ceiling support, called de minimis in trade parlance, for the natural textile fibre.

Australia has asked India to provide the overall value of cotton production in the country and confirm that New Delhi has not exceeded the ceiling. The issue came up on June 17-18 at the meeting of the WTO Committee on Agriculture.

“India affirmed that its cotton support has not exceeded its de minimis spending limit,” said a Geneva-based official.

Subsidy ceilings for India and other developing countries are fixed at 10% of the value of food production. The queries come at a time when India has invoked the peace clause for exceeding the subsidies for rice two years in a row.

On the AIF, Canberra sought details of how financing will be provided for the projects, including the crops that fall within the definition of ‘export clusters’. The AIF is a medium-long-term debt financing facility for investment projects for post-harvest management infrastructure and community farming assets, such as providing supply chain infrastructure for clusters of crops including export clusters.

Australia also wanted to know which fruits, vegetables and other commodities are included in the export clusters, according to the official.

At the meeting, Canada, the EU, Russia, Ukraine and the US again questioned India on continued restrictions concerning imports of pulses, public stockpiling, export subsidies for skim milk powder, and its export prohibition on onions.

The EU, Brazil, Japan, Paraguay and Russia expressed concerns about the lack of transparency or missing information concerning India’s rice purchases and subsidies, and public stockholding data, and said that the information was crucial as New Delhi is a key proponent of a permanent solution on public stockholding for food security.

On its part, India asked the EU, the US and Canada for their pending notifications on domestic support, and questioned Canada on its plans to spend $101 million over two years on a programme for the wine sector.

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