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US, India Reach Food Subsidy Deal in Stalled WTO Pact

  • VOA News

FILE - Kashmiri farmers separate grain from the chaff after harvest in Boras village, about 25 miles northeast of Srinagar, India.

FILE - Kashmiri farmers separate grain from the chaff after harvest in Boras village, about 25 miles northeast of Srinagar, India.

The United States and India have announced an agreement to resolve a dispute about food subsidies that has held up the ratification of a global trade pact.

World Trade Organization delegates approved the trade deal last December, seeking to streamline customs rules and cut the cost of shipping goods around the world.

The pact needed approval of all 159 WTO members, but India declined to ratify it because of concerns about a clause that restricts the size of food subsidies governments could provide.

The White House issued a statement Thursday saying the U.S. and India agreed on a provision that calls for WTO members not to challenge the subsidy programs until they agree on a "permanent solution" to the matter.

The White House said the U.S. and India will present the proposal to the WTO "in the near future."

An Indian law passed last year calls for the government to provide wheat and rice at low prices to 850 million people.

Developing nations say that kind of subsidy is necessary to ensure their people have adequate food, but the WTO worries the programs could distort global markets.

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