MSP, WTO & DEMOCRACY:AN OVERVIEW

Abstract

There is national wide debate for providing a legal guarantee in the form of minimum support price (MSP) to the farmers, in the political as well as social domain. The question which has attracted the attentions is that whether India being the member of WTO would be in a position to provide legal security in the form of guarantee of MSP to its farmers without breaching the provisions of international law as envisaged in the Agreement on Agriculture (AoA) under the WTO regime? To understand this, one has to be familiar with some technical terms like Green Box, Blue Box and Amber Box and also brief description of calculation of aggregate measure of support (AMS), product specific support and non product specific support under Article 6 of AoA is necessary. The procurement of 23 crops at MSP against current practice of procurement of rice and wheat and other likecrops may put India in a position of breaching de minimis limit. It would create legal challenges at the WTO for India and making it vulnerable. Some alternatives to escape Amber box like indirect procurement, peace clause, income base support and price base support with practical difficulties has been seen. At the last of the Article, suggestions as to requirement of government are made by making active engagement with farmers by creating an suitable environment by convincing them of other effective policy other than MSP and which are also financially and economically viable as well as WTO compatible.