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 IMPLICATIONS OF WTO ON
INDIAN AGRICULTURE SECTOR.
 INTRODUCTION.
4 TOPICS TO BE COVERED͙.
1. GATT
2. WTO
3. INDIAN AGRICULTURE.
4. WTO AND INDIAN AGRICULTURE.
 GATT.
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4 On 1 January, 1948 the agreement was signed
by 23 countries.
4 GATT held a total of 8 rounds.
4 þ

  !"
The Uruguay Round began in 1986. It was the
most ambitious round to date, hoping to
expand the competence of the GATT to
important new areas such as services, capital,
intellectual property, textiles, and   #
123 countries took part in the round.
 WTO
4 World Trade Organization
4 The WTO was born out of the General
Agreement on Tariffs and Trade (GATT).
4 Headquarters : Geneva, Switzerland
4 Formation : 1 January 1995
4 Membership : 153 member states
4 Budget : 163 million USD (Approx).
4 It is an international organization designed to
supervise and liberalize international trade.

4 The WTO has 153 members, which represents

more than 95% of total world trade.

4 WTO cooperate closely with 2 other

component IMF and World Bank.
 Purpose
4 WTO is to ensure that global trade
commences smoothly, freely and predictably.

4 Transparency in trade policies.

4 Work as a economic research and analysis

centre.
 Aim

4 To create economic peace and stability in the

world through a multilateral system based on
consenting member states, that have ratified
the rules of the WTO in their individual
countries as well.
 WTO Vs GATT
ð 
4 It was ad hoc & provisional. 4 It is permanent.

4 It had no provision for 4 It has legal basis because

creating an organization. member nations have verified
the WTO agreements.

4 It allowed contradictions in 4 More authority than GATT.

local law & GATT
agreements.
4 It doesn't allow any
contradictions in local law .
 INDIAN AGRICULTURE.
4 Agriculture in India has a long history dating
back to ten thousand years.
4 Today, India ranks second worldwide in farm
output.
4 Agriculture accounted for 16.6% of the GDP in
2007, employed 60% of the total workforce
and despite a steady decline of its share in the
GDP, is still the largest economic
 OVERVIWE.
4 Yields per unit area of all crops have grown since
1950 due to application of modern agricultural
practices and provision of agricultural credit and
subsidies since Green revolution in India.

4 However, international comparisons reveal that

the average yield in India is generally 30% to 50%
of the highest average yield in the world.
 ! !!!

4 The Indian Agricultural Research Institute (IARI),
established in 1905, was responsible for the
research leading to the "Indian Green Revolution"
of the 1970s.

4 The Indian Agricultural Statistics Research

Institute develops new techniques for the design
of agricultural experiments and specializes in
statistical techniques for animal and plant
breeding.
 j$%#
The low productivity in India is a result of the
following factors:

4 Overregulation of agriculture has increased

costs, price risks and uncertainty.

4 Government intervenes in labour, land, and

credit markets. India has inadequate
infrastructure and services
4 Illiteracy, general socio-economic backwardness,
slow progress in implementing land reforms .
4 Inadequate or inefficient finance and marketing
services for farm produce.
4 The average size of land holdings is very small
due to land ceiling acts and in some cases, family
disputes.
4 Such small holdings are often over-manned,
resulting in disguised unemployment and low
productivity of labour.
 WTO AND INDIAN AGRICULTURE
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After over 7 years of negotiations the Uruguay
Round multilateral trade negotiations were
concluded on December 1993 and were
formally ratified in April 1994 at Marrakesh,
Morocco.
4 The WTO Agreement on   was one
of the 
 
which were
negotiated during the Uruguay Round.
4 The WTO Agreement on Agriculture contains
provisions in 3 broad areas of agriculture.
1. Market access.
2. Domestic support.
3. Export subsidies.
 Market access.
4 This includes tariffication, tariff reduction and
access opportunities.
4 Tariffication means that all non-tariff barriers
such as...
1. quotas.
2. variable levies.
3. minimum import prices.
4. discretionary licensing.
5. state trading measures.
 DOMESTIC SUPPORT.
4 For domestic support policies, subject to
reduction commitments, the total support
given in 1986-88, measured by the Total
Aggregate Measure of Support (total AMS).
 EXPORT SUBSIDIES.
4 The Agreement contains provisions regarding
members commitment to reduce Export
Subsidies.

4 Developed countries are required to reduce

their export subsidy expenditure by 36%.

4 For developing countries the percentage cuts

are 24%.
 Special and Differential Treatment
1. These include purchases for and sales from
food security stocks at administered prices
provided that the subsidy to producers is
included in calculation of AMS.

2. Developing countries are permitted

untargeted subsidised food distribution to
meet requirements of the urban and rural
poor.
 INDIA͛S COMMITMENT.
4 As India was maintaining Quantitative
Restrictions due to balance of payments
reasons(which is a GATT consistent measure),
it did not have to undertake any commitments
in regard to market access.
4 India does not provide any product specific
support other than market price support.
4 !
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Indirect subsidies available to them are in the
form of-:
4 (a) exemption of export profit from income tax
under section 80-HHC of the Income Tax

4 (b) subsidies on cost of freight on export

shipments of certain products like fruits,
vegetables and floricultural products.
 WHAT WE WANT
4 India͛s basic objectives in the ongoing
negotiations are:
4 (a) To protect its food and livelihood security
concerns and to protect all domestic policy
measures taken for poverty alleviation, rural
development and rural employment.

4 (b) To create opportunities for expansion of

agricultural exports by securing meaningful
market access in developed countries.
 INDIA & AOA
4 Except in rice market ,India is negligible force
in global market.
4 Domestic subsidies of rich nation will not
effect India.
4 Many Indian products are cost effective in
domestic market.
4 So, no fear of cheap import flooding Indian
market.
 CONCLUSION.
It will be ͞just͟ to highlight one issue each
where the RICH countries and poor countries
need to be honest.

Let us be honest to understand that

dominance of politics over economics and fair
play will never render justice.
4 ͞With malice toward none ,charity for all with
firmness in right as god has given us to see the
right, let us strive on to achieve adjust and
prosperous nation among all other nation͟
THANK YOU