Top American senators have asked the Joe Biden administration to file a World Trade Organization (WTO) complaint against India for subsidizing its farmers by more than half the value of wheat production.
US Wheat Associates, which has been vigorously lobbying the administration for such a step, has welcomed the letters from members of Congress and the Senate.
According to a letter signed by 28 members of the US Congress, ‘American commodity producers are operating at a clear disadvantage to their competitors, primarily from India, where the government is subsidizing more than half the value of producing rice and wheat, instead of the 10% acceptable under World Trade Organization (WTO) rules.’
‘We request that you take immediate action to change India’s trend of non-compliance with WTO domestic support standards by starting a dispute settlement case,’ the letter to US Trade Representatives Katherine Tai and Tom Vilsack added.
Members of Congress wrote The United States has repeatedly urged India at the World Trade Organization to alter its price support program but to no benefit.
‘Given India’s activity,’ they stated, ‘we recommend you to commence the WTO litigation procedure through a request for consultations.’
The letter from Congressmen on January 13 comes nearly a month after 18 Senators wrote to Vilsack and Tai urging that the Biden government pursue a WTO action against India’s domestic subsidy for rice and wheat cultivation.
The United States has already highlighted India’s noncompliance through counter-notifications before the World Trade Organization’s Committee on Agriculture.
In a statement responding to the lawmakers’ action, US Wheat Associates said it was ‘pleased that several members of Congress have asked Secretary of Agriculture Tom Vilsack and United States Trade Representative Katherine Tai to pursue a WTO case against India’s trade-distorting domestic rice and wheat support.’
According to Chandler Goule, CEO of the National Association of Wheat Growers, it is critical that India, as a WTO member, comply with international agreements and not continue to create unfair advantages for local production and distort world commerce.
‘We welcome these Senators bringing the matter to the administration’s notice, and we will continue to work with the United States Department of Agriculture (USDA) and the United States Trade Representative (USTR) to improve the competitiveness of US wheat around the world,’ he added.
The USDA predicts that Indian wheat exports would total 5 million metric tonnes for the marketing year ending June 30, 2022. (MMT). According to a press release, ‘this leaves over 28 MMT of wheat stocks. According to a 2020 Texas A&M University research commissioned by USW and USA Rice, the distortion of international wheat and rice commerce is significant, costing US wheat producers more than $500 million per year in lost income.’