India underreports its market price support for certain crops, the countries said
By Diego Flammini
Canada and the United States are speaking out against India at the World Trade Organization (WTO) because of market price discrepancies.
On Feb. 12, the North American countries submitted a counter notification in the WTO’s Committee on Agriculture.
“When calculated according to (the) WTO Agreement on Agriculture methodology, India’s market price support for each of these pulses far exceeded its allowable levels of trade-distorting domestic support,” the USDA said in a statement.
India isn’t calculating its market price supports for chickpeas, pigeon peas, black matpe, mung beans and lentils properly, Canadian and American officials allege.
India calculates its market price supports in U.S. dollars, when it should be doing so using Indian Rupees.
India, for example, calculated its market price supports for all five lentils in 2016-17 marketing year to equal about US$374 million. But the U.S. and Canada calculation for the same period brought the supports to about US$9.8 billion.
India is also only calculating the quantity of pulses it buys as part of its price supports, while the U.S. and Canada are taking all pulse production into account.
Using different currencies and production figures can result in significant differences, said Gordon Bacon, CEO of Pulse Canada.
“Countries are obligated to report what support they’re providing to ensure they’re living up to the commitments they’ve made,” he told Farms.com. “Canada did its calculations in Indian Rupees, but India is saying it has the right to do the calculations in U.S. dollars. So, we’re challenging some of the things India is doing with regard to production support.”
India may just have to review how it calculates its price support. If no resolution is reached, Canada and the U.S. may file an official complaint, Bacon said.
The market price support, unlike the fumigation issue, shouldn’t affect Canadian producers, he said.