Dear President Biden,
We write to express our continued support for holding India accountable in response to their decade-long violations of their World Trade Organization (WTO) commitments. India's practices are dangerously trade distorting on a global scale and impact U.S. farmers and ranchers. As you know, it is up to American agriculture to contribute to building resilient conditions for food security for the U.S. and throughout the world.
It is important to note that Congress is still awaiting a response to a letter penned on January 13, 2022, to U.S. Trade Representative Ambassador Katherine Tai1 that similarly calls for initiation of a dispute settlement case against India.
Current WTO rules allow governments to subsidize up to 10% of the value of production for a particular commodity and still export that subsidized commodity without fault. However, for years, the Indian government has abused WTO rules and subsidized more than half of the value of production for rice and wheat. Unfortunately, because they have long gone unchecked, India has already reshaped global agricultural production and trade channels by driving down prices and depressing production of staple commodities like rice and wheat in the rest of the world.
At its core, multilateral trading rules can always be strengthened to promote robust, adaptive, and innovative agricultural markets. Those that seek to undermine and/or distort these agreed upon free and fair-trade practices must be held accountable for intentionally or unintentionally yielding food insecurity, disproportionately harming low-income suppliers and consumers.
One must look no further than the WTO's 12th Ministerial Conference (MC12) that was held recently to understand that exact concept. Led by India, a group of developing WTO members proposed an unlimited allowance of trade distorting price supports tied to public stockholding and subsidies. The proposal disregards WTO rules on agricultural domestic support partly put in place to ensure fairness of and confidence in the world's farmers and instead benefits only a few countries. We share the agricultural industry's concerns2 that if this proposal goes into effect, it could disproportionally disadvantage American producers who are already struggling. We were glad to see that Ambassador Tai and her peers rejected India's calls for a permanent, unlimited expansion of these limits and a subsidy exemption for commodities sold from government-to- government at MC12.
The strong coalition of both agricultural producing countries and developing countries that rejected India's proposal signals that there is recognition that India does not play by the rules and that a dispute settlement case against India's domestic support programs would be welcomed.
We urge the Administration to take our requested action through filing a formal request for consultations with India at the WTO and to continue monitoring other WTO member's domestic support programs that undermine fair trade practices. America must not yield for the sake of reaching consensus. Instead, America must work to promote solutions that will alleviate the global supply chain and food shortages, and America must take actions that will address those consumers most impacted by inflation and rising food prices. We cannot begin to implement other, long-term policy solutions if American citizens and citizens of the world are going hungry.