Report by the Secretariat (WT/TPR/S/249): III. Trade Policies and Practices by Measure (4) Measures Affecting Production and Trade: (i) Incentives (b) Other support
Paragraph 179 states that "'[o]ther subsidies', which account for 3% of the total explicit subsidies in 2010/11, include market intervention and price support schemes for agricultural products." This section is qualified by footnote 233, which states that "[t]he term 'subsidy' in this section is used as in India's Budget and other official documents, and not in the sense of the WTO Agreement on Subsidies and Countervailing Measures."
Question: In light of this language, would India consider any price support schemes to constitute countervailable subsidies under the Agreement on Subsidies and Countervailing Measures (SCM Agreement)? Or does India believe that price support schemes are outside the scope of the SCM Agreement?
Reply: The definition of a subsidy under Article 1 of ASCM, inter alia, includes under Article 1.1(a)(2) a financial contribution by a government or public body where there is any form of price support in the sense of Article XVI of GATT 1994. Further by such financial contribution a benefit should be conferred and a subsidy shall be subject to the provisions of Part V only if such a subsidy is specific in accordance with the provisions of Article 2. Article XVI of GATT refers to subsidies in general which operate directly or indirectly to increase exports or reduce imports of a product. Therefore, any price support per se cannot be termed as a "countervailable subsidy".
