It’s time for India to show the WTO that humility is the prime virtue of a beggar

No matter how capable you are, when you have to ask for help, humility becomes the prime virtue. This particular trait has helped bring down kingdoms through soft power. But, this aspect of human nature is missing in supranational organisations like the World Trade Organisation (WTO).

India to push for reform in WTO

As the western world keeps mounting pressure on India, the South Asian giant has also geared up with a countermeasure. In the event of increased demand for India’s produce in the western world, the Modi government has decided to pitch for a radical change in the way WTO interacts with the developing world.

During the next WTO meeting to be held in Geneva, India will be pitching for a permanent solution to the regulations around Food Security and public stockholding of its produce. Commerce Minister Piyush Goyal will be leading the Indian delegation in the meeting which is to begin on June 12. An official said, “Finding permanent solution to public stockholding will be our key demand,”

If not now, the never for India

The upcoming meeting is possibly the biggest opportunity for India in decades. Currently, the world needs India’s produce and the situation is so bad that if India refuses to export its grains, then it could trigger a hunger crisis in many countries, especially the erstwhile third world nations being showered with western aid. Apparently, it would lead western countries towards the pit of illegitimacy.

Read more: Famine of Biblical proportions: As millions in Britain sleep without food, West is facing a hunger pandemic

However, even in this state of deprivation, these countries and the organisations being led by them are not ready to stop browbeating their former colonies. Up until now, they have shown no intent of relaxing WTO norms intended to stop developing countries from achieving their full potential.

WTO is against feeding the developing world

Currently, there are multitudes of issues which the WTO needs to sort out with India. The primary issue among them is farm subsidies. According to current WTO norms, India cannot provide farm subsidies beyond 10 % of the total monetary value of food produced. So, if India produces food worth $10 billion, it cannot provide a subsidy worth more than $1 billion.

The WTO says that it provides unfair advantages to the countries, distorting trade. However, this kind of logic is only true for printing money. Restricting farm subsidies only inhibit member countries from effective crop production. The countries which have decided to follow this cap can never do justice to their indigenous farmers. That is why India decided not to adhere to it when required. Currently, India constantly breaches this ceiling and has invoked a peace clause in the WTO agreement which permits an uninterrupted breach of the 10 per cent barrier.

However, the clause has operational difficulties. India has to periodically submit its data on food procurement, stockholding, distribution, and subsidies to the 164-member forum. India has asked WTO to change the subsidy formula and include new programmes in the ‘peace clause’ as well. These new programs were launched by the Indian government after 2013.

If the aforementioned restriction was not enough, through WTO, these rich countries have often tried to dissuade India and other countries from feeding the poor. WTO asks these countries to not purchase grains from farmers at a pre-esteemed price (minimum support price in case of India). India has refused to do so and has invoked a peace clause to avoid penalty. But, then again, it is not a permanent solution.

WTO needs India, rather than the other way around

Though India did manage to chalk out an agreement with the USA on the issue, over the years most of the WTO members have been adamant about their stand on the issue. That is why the global demand for Indian wheat becomes a crucial strategic opportunity for India.

Now that they need India’s produce, more and more countries would be willing to listen to India’s concerns and vote in its favour. These countries know that if they would not support India, then they are up for a big loss while India won’t receive any greater impact. You see, India’s economy is neither fully dependent on imports nor on export earnings to keep it going. Though, it is true that having a trade surplus helps the country, but, countries like India and China may not need it. Simply because the domestic consumption is good enough to keep the chain of demand and supply going.

Western countries need to wake up

It is not as if India will be imposing its authority for the very first time. Most countries still believe that India has remained a third world country depending on foreign aid for feeding its population. But that socialist legacy is long gone and India has been on a surplus production spree for decades now.

Read more: Piyush Goyal set to finish the last vestige of Nehruvian socialistic legacy in business

In fact, the world witnessed India’s economic might when it categorically refused to join the multilateral Regional Comprehensive Economic Partnership (RCEP) composed of economic heavyweights. In fact, the offer to join RCEP is still open for India, but the Modi government has refused to surrender India’s economic interests.

Read more: Dumping RCEP is turning out to be a boon. India is slowly bridging trade deficit with China and Southeast Asia

The WTO is living in a false reality of western countries being at the top of the food chain. It’s not the organisation’s fault, as western countries are experts in creating an alternate reality and then blaming actual reality for the looming crisis. But, it’s time they should wake up and do what will serve the greater good. All it requires to avoid the looming hunger crisis is being a bit humble. That should not be a great deal, because the alternative is way worse.

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