WTO Approves Framework on Customs Norms

Accepting India’s demand to remove constraints on food stockpiling, WTO approved a framework for a global pact to ease customs norms.

The approval comes days after the impasse between the US and India over food stockpiling was resolved through direct contact between US President Barack Obama and Prime Minister Narendra Modi on November 13.

This is the first major pact reached by WTO members since the multilateral trade body came into existence in 1995. The agreement will now have to be ratified by governments of member countries and can come into effect sometime next year.

In July, India had refused to ratify the Trade Facilitation Agreement (TFA) - meant to ease customs norms - demanding that the WTO members find a permanent solution to the issue of public stockholding of foodgrain to feed its poor and an extension of the peace clause.

Under the peace clause, a WTO member is not penalised for breaching the food subsidy cap. A developing nation can provide food subsidy of up to 10% of its total farm output.