New Delhi. India and Brazil have started talks at the World Trade Organization (WTO) to mutually resolve the sugar-related trade dispute. As part of the resolution of this dispute, the South American country can share ethanol production technology with India. An officer has given this information. Brazil is the largest producer of sugarcane and ethanol in the world. It is also a leader in the technology used for ethanol production. “A few rounds of talks have taken place as part of our efforts to resolve the dispute,” the official said. We have also held inter-ministerial meetings here.
Brazil has said that it will share ethanol (production) technology with us. This is a positive thing.” Ethanol is used for mixing in vehicle fuel. The use of ethanol extracted from sugarcane as well as broken rice and other agricultural produce will help the world’s third largest crude oil consumer and importer reduce its dependence on imports. India currently imports 85 percent of its crude oil needs. Besides, ethanol also reduces carbon emissions. India has set a target of blending 20 percent ethanol in petrol by 2025.
To resolve the dispute in the Geneva-based multilateral body, India will also have to offer something from its side under the Mutually Agreeable Solution (MAS). Recently India and the US have settled six trade disputes and have also agreed to end the seventh case.
Under this solution, while India has removed ‘retaliatory’ duties on eight US products like apples and walnuts, the US is providing market access to Indian steel and aluminum products without imposing additional duties. The official said India is adopting a similar procedure for other complaints in the sugar dispute at the WTO. In 2019, Brazil, Australia and Guatemala had dragged India into the WTO’s dispute settlement mechanism and alleged that India’s sugar subsidies to farmers were not in line with global trade rules. On 14 December 2021, the WTO dispute settlement panel ruled that India’s support measures to the sugar sector are not in line with global trade norms. In January 2022, India appealed against the panel’s decision to the WTO’s Appellate Body. The Appellate Body has the final authority to pass decisions against disputes.
However, it is not functioning due to differences among countries over the appointments of members of the Appellate Body. Brazil is the largest producer and exporter of sugar in the world. India is the second largest sugar producer in the world. WTO members Brazil, Australia and Guatemala had complained that India’s support measures to sugarcane growers exceed the minimum level of 10 per cent of the total value of sugarcane production. This is not in line with the WTO agreement on agriculture. Apart from this, these countries have also expressed concern over India’s alleged export subsidy. According to WTO rules, if any WTO member feels that any trade measure is against WTO rules, it can file a case in the multilateral body in Geneva.
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