Why in News?

• US Trade Representative highlighted that sorting out World Trade Organisation (WTO) disputes with India is a win for the agriculture and rural communities in the US.
• However, she raised some concerns on India’s wheat subsidies allegedly hurting American farmers.

What’s in Today’s Article?

• How India-US Settled WTO Disputes?
• Impact of Settling WTO Disputes on Indian and US Economy
• Case of India’s Wheat Subsidies and India’s Take on This

How India-US Settled WTO Disputes?

• The discussions on bilateral settlement of pending WTO disputes between both sides began during the annual Trade Policy Forum (TPF) meeting between both countries in January 2023.
  • The TPF aims to resolve trade and investment issues between both nations.
• Since these outstanding disputes were areas where both countries have had some wins and some losses, both countries have directed their officials to engage ‘aggressively’ on the matter.
• Thereafter (in June 2023), both sides decided to close half-a-dozen outstanding disputes at the WTO including the retaliatory tariffs India imposed on imports of some farm products from the US.
• The six disputes included -
  • India’s appeal against the US's imposition of tariffs on imports of steel and aluminium products from India;
  • The US appeal against India’s retaliatory tariffs;
  • India’s renewable energy subsidies for solar cells and modules under Jawaharlal Nehru National Solar Mission;
  • India’s appeal over similar subsidies for solar cells and solar modules by eight US state governments;
  • The US appeal against India’s export subsidy programmes;
  • India's imposition of countervailing duties on imports of certain hot-rolled carbon steel flat products from the US.
• The last dispute between the two, which was settled in September 2023, was on poultry import from Washington as part of which India agreed to cut import duties on some farm items.

Impact of Settling WTO Disputes on Indian and US Economy:

• The US was India’s largest trading partner in 2022-23 with bilateral trade rising 7.65% to $128.55 billion.
• Settling of disputes means improved access for chickpeas, lentils, almonds, walnuts, and apples benefiting farmers across the country.
• India agreeing to reduce tariffs on several US products means more market access for turkey, duck, blueberries, and cranberries benefiting farmers in the US.

Case of India’s Wheat Subsidies and India’s Take on This:

• According to the USTR, India’s wheat subsidies are distorting prices and making it harder for the USA’s farmers to compete in the Asian market.
• In discussions around its wheat subsidies under the MSP programme at the WTO, India has been maintaining that -
  • Its subsidies were well within the range prescribed by the WTO, and
  • Its food security programmes were necessary to support vulnerable farmers and feed the poor.