India may seek four-year waiver to save its food security scheme at WTO

The union cabinet on Thursday decided to ring-fence its food security plan at the World Trade Organisation (WTO) by agreeing to a four-year 'peace clause' with certain conditions.

Although there was no official confirmation on the cabinet decision, it is understood that India will seek a four-year concession for its food security plan at the WTO's inter-ministerial meeting to be held in Bali next month.

The condition is that India would endorse the Trade Facilitation Agreement if the WTO ministerial agrees to the 'interim solution' (four-year peace clause), which would remain in force until a permanent solution is reached.

If this proposal is accepted, it would protect India's food security plan from WTO penalties even if 10 per cent subsidy cap is breached.

The cabinet stance on the country's minimum support prices on the Bali package for the upcoming World Trade Organisation (WTO) conference, however, is that India cannot agree to the temporary safeguard proposed by Director-General Roberto Azevedo.

India's minimum support prices (MSPs) for farmers are currently in danger of breaching the WTO caps for permissible agricultural production subsidies.

''Also, India will never agree to temporary safeguards for our MSPs from the WTO rules; we will only agree to a permanent solution.''

Meanwhile, for the second time in a week, the cabinet deferred a decision related to further liberalising the rules for the construction development sector.

To boost investment in the construction development sector, it was proposed that a minimum area and capital requirement for serviced housing plots and construction development projects should be halved, or even lowered.

There was, however, no decision on the proposal.