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INDIA
BUSINESS WORLD -
DECEMBER 2005
THE MONTH THAT WAS
NATH RULES OUT DUTY CUTS ON FARM IMPORTS
Commerce & industry minister Kamal Nath said India would not reduce import duty on key items like edible oil, sugar and foodgrain. “There is no commitment to reduce duties on agri products. We have made special provisions to protect the interests of our farmers,” he said while speaking at a media briefing here after his return from the Hong Kong ministerial meeting of the World Trade Organisation (WTO).
On the other hand, Indian farmers would get enhanced market access as the Hong Kong agreement would force industrialised countries like the US, France and Germany to phase out farm export subsidies.
Emphasising that interests of farmers have been protected, Mr Kamal Nath said there was no question of committing any reduction in customs duty on sensitive agri products. These items will be covered under the provision for special products which will be exempt from duty cuts, he explained.
Another provision has also been made for countries like India through a special safeguard mechanism (SSM). This facility will enable developing countries to check surge in imports on the basis of fall in prices of the commodity concerned and on the basis of sudden increase in import volumes.
Mr Nath, refuting charges made by Left parties, said he would speak to them to explain the impact of the understanding. “We will convince them. Export subsidies were distorting trade in a big way due to their direct impact,” he said. Due to pressure from developing countries, the EU and the US have agreed to phase out farm subsidies by 2013.
Mr Nath said the fineprint of the WTO ministerial declaration would be highlighted to Left parties to explain the gains achieved by India. The modalities of a meeting with these parties is expected to be worked out soon. The commerce & industry minister may also make a statement in Parliament soon on the developments at Hong Kong.
India made substantial gains from the deal without compromising on its policy space, Mr Kamal Nath emphasised. The CPM had accused the government of failing to protect the interests of farmers and the country at the WTO conference. The commerce & industry minister asserted that the government has not made any compromise in the talks and the agreement takes on board the concerns of agriculture, industry as well as the services sector. In agriculture, India would not have to make any cuts in the ‘de minimis' (a very small quantity, considered insignificant) subsidies that are provided to the farmers.
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