India Utilizes WTO Peace Clause for Rice Subsidies in FY25
India invokes WTO peace clause for FY25 rice subsidies for farmers
The Economic TimesImage: The Economic Times
India has invoked the World Trade Organization's peace clause for the seventh time, reporting rice subsidies of $7.6 billion for the fiscal year 2024-25, exceeding the 10% ceiling. This move protects its food procurement programs, aimed at ensuring food security for vulnerable populations.
- 01India's rice subsidies reached $7.6 billion, exceeding the WTO's 10% ceiling.
- 02The peace clause protects India from WTO actions for exceeding subsidy limits.
- 03The subsidies represent 11.85% of the total rice production value.
- 04India first invoked the peace clause in 2020.
- 05Input subsidies for low-income producers decreased slightly to $42.5 billion.
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India has officially invoked the World Trade Organization (WTO) peace clause for the seventh time, citing rice subsidies that total $7.6 billion for the fiscal year 2024-25. This amount exceeds the WTO's permissible 10% ceiling, representing 11.85% of the total production value of $64.13 billion. The peace clause, first invoked by India in 2020, safeguards the country's food procurement programs from potential WTO disputes, allowing it to support its low-income farmers without distorting international trade. The subsidies are part of India's public stockholding programs aimed at ensuring food security for its poor and vulnerable populations. Additionally, input subsidies provided to low-income producers for the marketing year from October 1, 2024, to September 30, 2025, were reported at $42.5 billion, a slight decrease from $43.25 billion in the previous year.
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This decision allows India to continue supporting its farmers and ensuring food security without facing penalties from the WTO, which is crucial for the livelihoods of many low-income producers.
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