May17 Movement Reply to Ministry of Commerce & Industry’s Rejoinder to our allegation on Ration Shops and Farm Subsides.

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Kind attn to : Honorable Minister Thirumathi. Nirmala Sitharaman
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Counter to the rejoinder dated 05/05/2016 of Ministry of Commerce and Industry.

While thanking the ministry for the response to our press release, we have total disagreement to the contents of the aforesaid your rejoinder of the ministry.

With the balance tilted towards the Developed Nations post TFA ( Trade Facilitation Agreement) ratification by your government in November 2014, India, the champion of the developing nations and least developed nations from Doha meeting, find its concern to push for the DDA (Doha Development Agreement) is more difficult if not easy. Your statement in parliament post July 2014 summit of WTO(World Trade Organization) on FTA and its implications was historic and stronger, but your parliamentary statement in November without enough briefing and reasons is very surprising since it lost the commitment and conviction which you showed in your speech delivered four months earlier. In your August 5th address in 2014 clearly states that the FTA can be signed if all of the DDA is being agreed by the developed nations and you also clearly explained the implications on signing FTA without getting the DDA consensus. The para from 3 to 8 clearly explains the people of India about the importance of the FTA in achieving goals of India’s concern at WTO.

The ministry involved in international negotiations on trade, is bound to inform the common public about the apprehensions and contradictions between the statements made in the parliament on 05/08/2014 and 28/11/2014 by the Honorable Minister and to the happenings at Nairobi WTO meet during December 2015.

We believe, having the ministry thrown away its only negotiating trump card in favour of developed countries, particularly to US, without getting anything in return, India along with other developing countries, are reduced to a point of weakness on a negotiating table and made to seek mercy to get the long pending Public Stock Holding of food Security and Speical Safeguard Mechanism – SSM to be resolved. The Ministry and the NDA government hasn’t clarified the nation about the urgency and the rationale in signing the FTA within four months from its stand-off, without seeking public consensus and not even consulting the major political parties in our country. We have a strong view that this is a very very serious issue and needs debate in parliament as the Honorable minister herself knows the importance of the FTA in clinching the deal specific to India. Post signing of FTA, your statement in Parliament in November 2014, didn’t even explain the brownie points favorable to our nation through FTA.

The high hopes on Nairobi fostered by the Honorable Minister on 28/11/2014 after clearing all huddles to the developed countries led by US from the deadlock created on 31/07/2014 to the Trade Facilitation Agreement-TFA-now proved futile. The time framed decision on permanent solution before 31/12/2015 assured by the General Council of WTO on 27/11/2014, is further extended without a time frame by the Director General of WTO through letter dated 21/12/2015.

To our great distress, after achieving TFA from the dead lock created by India during July /2014 and on voluntary withdrawal by India, the US and EU, now opened the other door to say that DDA is dead. Report says that India not even raised its objection, when China, the other member in the five member team was almost waging a war against the move of US and EU (Ref:EPW 12/03/2016 P50).

TFA is one of the four major Singaporean Agenda, which was thrown out in 2003 Cancun meet of DDA, found its way into DDA and became a ‘binding’ agreement as WTO, wherein 2001 DDA, which centered on public stock holding of food security could not find place in the agreement or a permanent solution as a package of Bali meet or at least compliance of General Council time frame decision before 31/12/2015, leave alone single undertaking assured by DDA as”nothing is agreed till everything is agreed”. Now public stock holding is reduced from term of WTO agreement to the best endeavor clause. Therefore the ministry is in crucial juncture to explain to the public how it is going to achieve the Public Stock Holding after losing all its golden opportunities.
When SSM is not covered by the ‘peace clause’ of no legal dispute till permanent solution, what relevance the SSM will have when TFA implemented in full force. We are unaware and could not imagine the situation, when TFA comes into force without any decision on permanent solution on public stock holding but with peace clause of no legal huddle. Will it not destroy our agricultural sector with agricultural trade influx through TFA? What assurance and mechanism is proposed by NDA government that this will not happen?

The effective abandonment of Doha Round at the Nairobi talks, NDA government has all the responsibility to address and reason out the failure of its move to ratify the FTA to the Indian public.
We have all the reasonable concerns and worries about how the ministry is going to face the grim situation of cotton growers, after cutting back export subsidy from 01/01/2017 though the farmer’s suicide is ever raising because of unbearable losses beyond their control.

Why India was unable to secure permanent solution in spite of strong support of majority of developing countries at Nairobi. NDA government’s weak posture in Nairobi has costed not only india but to all the developing and least developed countries awaiting to push the DDA agenda post Geneva ratification of FTA. The successful campaigning for the cause of the poor people across the globe in 2001 the DDA got shaped and this turned out to be the trump card for the developing and LDC till your ratification in Geneva on November 2014. Anyone going through your statement in Parliament on 5th August 2014 could easily understand on holding on to the DDA. ( Annexure enclosed)

Your plenary speech in Nairobi talks has all the components to indicate the world that the India is not prepared to talk tough on its commitments for her larger poor and the attitude of Indian mission to the Nairobi is not so encouraging to the countries and people who look for settlement for DDA, with only getting disappointed by your absence in the facilitators meeting aimed to address the agriculture negotiations. NDA’s lack of will to fight to move forward in DDA and take a lead in Nairobi talks including the steadied silence in the Green room negotiations helped the developed nations to take advantage in the WTO was not a secret to the world.

When a six point agenda, including public stock holding, SSM, along with export subsidy, cotton issue are at Nairobi how export subsidy and cotton issue, US interest matters alone found solution, and public stock holding and SSM are kicked further without any time frame.

What kind of further concession we bound to lose to secure the permanent solution on public stock holding and SSM?
Above all within a fortnight of 05/08/2014 statement at parliament, GOI, constituted High Level Committee under the head of former Chief Minister of Himachal Pradesh Mr. Santhakumar, to restructure Food Corporation of India which is the only strong food bastion for an effective ‘Public Distribution System’ in a progressive state like Tamilnadu. The committee submitted its reports on 22/01/2015, sharply after India cleared TFA on27/11/2014, recommending for gradual transfer of subsidy to Direct Benefit Transfer system and allow the Food Security Act to sleep. Now it all real that there is an agenda with GOI than the assurance of the ministry in its rejoinder dated 05/05/2016.

In summing up we reiterate our fear about PDS(Public Distribution System) and the farm subsidies to small farmers in specific. It is nothing but the apprehensions expressed by the Honourable Minister on 05/08/2014, which was very precisely confirmed in the subsequent Nairobi meeting.

Our concerns and fears were right on seeing the clearance TFA. Now the ministry or the Honorable Minister is bound to dispel the fear with equal reasons and arms & ammunition on hand to get things achieved in WTO and the reasons to disband Food Corporation of India, the key institution for public stock Holding and ensure PDS.

In the foregoing reasons our contention in the press meet about PDS and Subsidy to farmers are substantive.

Thirumurugan Gandhi
MAY SEVENTEEN MOVEMENT

Annexure :
1. Excerpts from Press Information Bureau, Government of India
Ministry of Commerce & Industry 05-August-2014 13:12 IST.

2. Statement by Nirmala Sitharaman in Lok Sabha Regarding “India’s Stand in the WTO”
3. Amongst these Ministerial Decisions, two are of particular significance — the Ministerial Decision for an Agreement on Trade Facilitation and the Ministerial Decision on Public Stock-holding for Food Security Purposes.
4. The Trade Facilitation Agreement is basically aimed at greater transparency and simplification of customs procedures, use of electronic payments and risk management techniques and faster clearances at ports. We have autonomously taken several similar measures such as the ‘Indian Customs Single Window Project’ announced in the Budget 2014-15 to facilitate trade, under which importers and exporters will be able to lodge documents at a single point, reducing interface with Governmental agencies, dwell time and the cost of doing business.
5. The Protocol of the Trade Facilitation Agreement (TFA) was to be adopted by 31 July 2014 by the WTO. After this the Agreement would automatically come into force from 31 July 2015 if ratified by two-thirds of the members of the WTO.
6. In contrast to their efforts on Trade Facilitation in the WTO, some developed countries have been reluctant to engage on other issues.
7. Seeing the resistance to taking forward the other Decisions, the apprehension of developing countries was that once the process of bringing the Trade Facilitation Agreement into force was completed, other issues would be ignored, including the important issue of a permanent solution on subsidies on account of public stock-holding for food security purposes.
8. India, therefore, took the stand that till there is an assurance of commitment to find a permanent solution on public stock-holding and on all other Bali deliverables, including those for the Least Developed Countries (LDCs), it would be difficult to join the consensus on the Protocol of Amendment for the Trade Facilitation Agreement

9. Nairobi Package : https://www.wto.org/english/thewto_e/minist_e/mc10_e/nairobipackage_e.htm

10. WTO site: https://www.wto.org/english/news_e/news16_e/fac_21apr16_e.htm

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