india –
measures concerning sugar and sugarcane
Reports of the Panels
TABLE OF CONTENTS
1 Introduction.. 16
1.1
Complaint by Brazil 16
1.2
Complaint by Australia. 16
1.3
Complaint by Guatemala. 16
1.4
Panel establishment and composition. 16
1.5
Panel proceedings. 17
1.5.1
General 17
1.5.2
The Panel's substantive meetings held by remote means. 18
1.5.2.1 First substantive meeting with the
parties and third parties. 18
1.5.2.2 Second substantive meeting with the
parties. 21
1.5.3
Preliminary ruling. 21
2 Factual aspects. 22
2.1
The measures at issue. 22
2.1.1
India's alleged domestic support to sugarcane producers. 22
2.1.2
India's alleged export subsidies. 24
3 Parties' requests for findings and
recommendations. 25
3.1
Brazil 25
3.2
Australia. 25
3.3
Guatemala. 26
3.4
India. 26
4 Arguments of the parties. 27
5 Arguments of the third parties. 27
6 Interim review.. 27
6.1
Introduction. 27
6.2
Requests for review of sections 1 to 3 (Introduction, Factual aspects, and
Parties' requests for findings and recommendations) 28
6.3 Requests for review of section 7.1 (Domestic
support) 28
6.4 Requests for review of section 7.2 (Export
subsidies) 30
6.4.1
Requests for review regarding the Panel's recommendation under Article 4.7 of
the SCM Agreement 32
6.5 Requests for review of section 7.3
(Notifications) 35
6.6 Requests for
review of the Appendix (Calculation of
India's market price support to sugarcane producers for the 2014-15 to
2018-19 sugar seasons) 35
7 Findings. 35
7.1
Domestic support 35
7.1.1
Introduction. 35
7.1.2
India's permitted level of product-specific support to sugarcane producers. 38
7.1.3
India's actual amount of non-exempt product-specific support to sugarcane
producers. 40
7.1.3.1
General considerations. 40
7.1.3.2
Market price support 42
7.1.3.2.1
Overview. 42
7.1.3.2.2
The scope of "market price support" 44
7.1.3.2.3
India's market price support to sugarcane producers. 52
7.1.3.2.4
Budgetary payments made to maintain the price gap. 53
7.1.3.3
Non-exempt direct payments and other non-exempt policies. 54
7.1.3.3.1
Overview. 54
7.1.3.3.2
Tamil Nadu's transitional production incentives. 56
7.1.3.3.3
Andhra Pradesh's purchase tax remittances. 58
7.1.3.3.4
Karnataka's incentive price payments. 61
7.1.3.3.5
Amount of non-exempt direct payments or other non-exempt policies to sugarcane
producers. 64
7.1.3.4
Overall calculation. 64
7.1.4
Comparison and conclusion. 64
7.2
Export subsidies. 65
7.2.1
Introduction. 65
7.2.2
Measures at issue. 67
7.2.2.1 MIEQs and MAEQ. 67
7.2.2.2
Production Assistance Scheme. 68
7.2.2.3 Buffer Stock Scheme. 69
7.2.2.4
Marketing and Transportation Scheme. 70
7.2.2.5
Duty Free Import Authorization (DFIA) Scheme. 71
7.2.3
Order of analysis. 72
7.2.4
Claims under the Agreement on Agriculture. 73
7.2.4.1
Introduction. 73
7.2.4.2
Overview of the relevant provisions. 74
7.2.4.3
India's export subsidy commitments. 75
7.2.4.4
Whether the Marketing and Transportation Scheme falls under Article 9.4 of the
Agreement on Agriculture. 76
7.2.4.4.1
Introduction. 76
7.2.4.4.2
Burden of proof 76
7.2.4.4.3
Main arguments of the parties and third parties. 77
7.2.4.4.4
Legal standard. 79
7.2.4.4.5
Assessment of the Marketing and Transportation Scheme under Articles 9.1(d) and
9.1(e) of the Agreement on Agriculture. 80
7.2.4.4.5.1
Whether the assistance under the Marketing and Transportation Scheme relates to
the types of costs in Articles 9.1(d) and (e) 81
7.2.4.4.5.2
Whether the amount of assistance provided under the Marketing and
Transportation Scheme exceeds the actual marketing and transportation costs. 82
7.2.4.4.6
Conclusion. 84
7.2.4.5
Whether India's assistance schemes are subsidies contingent on export
performance under Article 9.1(a) of the Agreement on Agriculture. 84
7.2.4.5.1
Introduction. 84
7.2.4.5.2
Legal standard. 85
7.2.4.5.3
Production Assistance Scheme, Buffer Stock Scheme, and Marketing and
Transportation Scheme. 87
7.2.4.5.3.1
Whether the assistance is provided by a government or its agency. 87
7.2.4.5.3.2
Whether assistance is provided "to a firm, to an industry, to producers of
an agricultural product, to a cooperative or other association of such producers,
or to a marketing board" 88
7.2.4.5.3.3
Whether the assistance is "a direct subsid[y]" 89
7.2.4.5.3.4
Whether the subsidies are "contingent on export performance" 95
7.2.4.5.4
Duty Free Import Authorization (DFIA) Scheme. 98
7.2.4.5.4.1
Introduction. 98
7.2.4.5.4.2
Whether the DFIA Scheme does not constitute a subsidy pursuant to
footnote 1 to the SCM Agreement 98
7.2.4.5.4.3
Whether the DFIA Scheme is inconsistent with Article 9.1(a) of the Agreement on
Agriculture. 100
7.2.4.6
Guatemala's claim under Article 9.1(c) of the Agreement on Agriculture. 102
7.2.4.7
Overall conclusion under the Agreement on Agriculture. 102
7.2.5
Claims under the SCM Agreement 102
7.2.5.1
Introduction. 102
7.2.5.2
Whether Article 27.2(b) applies to India. 103
7.2.5.3
Whether India's subsidy schemes are inconsistent with Article 3.1(a) of the
SCM Agreement 106
7.2.5.4
Conclusion under the SCM Agreement 107
7.2.6
Recommendation under Article 4.7 of the SCM Agreement 107
7.3
Notifications. 108
8
Conclusions and recommendations. 113
8.1 Complaint by Brazil (DS579) 113
8.2
Complaint by Australia (DS580) 113
8.3
Complaint by Guatemala (DS581) 114