The World Trade Organization(WTO) has set up panels to rule on complaints by Australia,Brazil and Guatemala against India’s export subsidies for sugar and sugarcane producers.
The three countries have claimed that India provides trade-distorting production subsidies including soft loans and subsidies to maintain stocks of sugar and tax rebates.
Australia has held India responsible for contributing to oversupply in the international sugar market.The production of sugar in India has increased from 22 million tonnes in 2016-17 to 34 million tonnes in 2017-18 thereby contributing to a surplus of 12 million tonnes.
Brazil has charged India with intensifying various support programmes for the sugar sector including higher minimum prices for sugarcane. Brazil has said that mandating the mills to export 5 million tonnes of sugar has led to substantial pricing pressures on world market prices.
However,India has disagreed with the claims made by the three countries.It said that its sugar-support programmes are aimed at assisting over 35 million vulnerable low-income resource-poor farmers to have a just and equitable share in economic development.
Further,India has also maintained that its measures were consistent with global trade rules, and did not create any adverse effect in the global sugar market.