BALI, INDIA — India and the U.S. reached an agreement on Nov. 13 on food stock holdings, clearing the way for passage of the biggest trade deal in the World Trade Organization’s 19-year history.
The two countries agreed that India will extend the world’s biggest food subsidy program until a permanent solution is reached, according to a U.S. statement.
In July, India had blocked part of the WTO deal because it was unclear if its program could continue past a 2017 deadline.
The India-U.S. agreement provides a basis for the WTO Director-General to intensify his consultations with other WTO members on the best way to overcome the present stalemate and to promptly implement all Bali ministerial decisions.
"This breakthrough represents a significant step in efforts to get the Bali package and the multilateral trading system back on track,” Director-General Roberto Azevêdo said. “It will now be important to consult with all WTO members so that we can collectively resolve the current impasse as quickly as possible.
"Implementation of all aspects of the Bali package would be a major boost to the WTO, enhancing our ability to deliver beneficial outcomes to all our members.
The trade body estimates that the agreement would stimulate the world economy by $1 trillion.
The India-U.S. agreement reflects “shared understandings” about the WTO’s work on food security, U.S. Trade Representative Michael Froman said. It will reduce the cost of trade by about 10% for developed countries and 14% for developing countries by removing delays at border crossings, he told reporters on a subsequent call.
While stressing that the India-U.S. understanding would represent a major step forward, the director-general stressed that members would need to redouble their efforts in order to minimize the delays provoked by the impasse on the conclusion of the post-Bali work program.
"The post-Bali work program remains a priority. Members will need to make every effort to get it back on track as quickly as possible," Azevêdo said.