FOLLOWING DISAGREEMENTS over food subsidy rules, India and the US have resolved their dispute and agreed on a trade deal.
It is estimated the breakthrough could lead to a global trade deal – which was due to take effect in the middle of next year – could add $1tn (£630bn) to the world economy and add as many as 20 million jobs.
At last year’s World Trade Organization summit in Indonesia, India said it would not budge on some rules governing food subsidies. India refused to back the Trade Facilitation Agreement, which would have potentially resulted in a cap on the grain welfare scheme which helps millions of the poorest Indian citizens.
But after Prime Minister Narendra Modi visited the US in September there was a shift in direction.
US Trade Representative Michael Froman said: “On the basis of this breakthrough with India, we now look forward to working with all WTO Members and with Director General Roberto Azevedo to reach a consensus that enables full implementation of all elements of the landmark Bali Package, including the Trade Facilitation Agreement.”
The statement also said Delhi and Washington have agreed that India’s food security programmes would not be challenged under WTO rules “until a permanent solution regarding this issue has been agreed and adopted”.
