india – measures concerning sugar and
sugarcane
Reports of the Panels
Appendix
This supplement
contains the Appendix to the Reports of the Panels to be found in documents WT/DS579/R, WT/DS580/R, and
WT/DS581/R.
_______________
Appendix
Calculation of India's market price
support to sugarcane producers for the 2014-15 to 2018-19 sugar seasons
Contents
1
Introduction.. 3
2 Relevant legal instruments. 4
2.1 Fair and Remunerative Price. 4
2.2 State-Advised Prices. 6
2.2.1 Bihar 7
2.2.2 Haryana. 7
2.2.3 Punjab. 8
2.2.4 Tamil Nadu. 9
2.2.5 Uttar Pradesh. 10
2.2.6 Uttarakhand. 11
3 Applied Administered Price. 11
3.1 General 11
3.2 Recovery rates. 13
3.3 AAP based on the FRP. 14
3.4 AAP based on the SAPs. 18
3.5 Summary. 19
4 Fixed External Reference Price. 19
5 Quantity of Eligible Production.. 22
6 Calculation of market price support. 23
1.1. In the circumstances of these disputes,
we consider it appropriate to assess India's compliance with Article 7.2(b) of
the Agreement on Agriculture by determining whether India's product-specific AMS
to sugarcane producers for each sugar season from 2014-15 to 2018-19 was in
excess of the amount that India is permitted to provide pursuant to the
Agreement.[1] We recall that, according
to the complainants, India's product-specific AMS to sugarcane producers
consists of: (i) market price support; and (ii) non-exempt direct payments or
other non-exempt policies.[2] This Appendix addresses
India's alleged market price support to sugarcane producers.
1.2. Paragraph 8 of Annex 3 of the Agreement
on Agriculture describes the methodology for calculating the level of market
price support provided by a Member. Under paragraph 8, "market price
support shall be calculated using the gap between a fixed external reference
price [FERP] and the applied administered price [AAP] multiplied by the
quantity of production eligible [QEP] to receive the applied
administered price". This can be expressed mathematically as:
Market price support = (FERP – AAP) * (QEP)
1.3. In support of their claim under Article
7.2(b) of the Agreement on Agriculture, the complainants apply the methodology
set out in paragraph 8 of Annex 3 to determine India's market price support to
sugarcane producers during each sugar season from 2014‑15 to 2018‑19. With
respect to each component of the calculation, the complainants present
considerable evidence and argumentation. Regarding the FERP, the complainants
note that, pursuant to paragraph 9 of Annex 3, the FERP may be adjusted for
quality differences.[3] On
that basis, the complainants calculate an adjusted FERP for different States
and seasons, using the methodology set out in India's Supporting Tables
identified in its Schedule.[4] As
to the AAP, the complainants assert that India's Central Government, as well as
certain State Governments, set mandatory minimum prices for sugarcane that constitute
AAPs within the meaning of the Agreement on Agriculture.[5] In
order to calculate both the adjusted FERP and the amount of the AAP, the complainants
provide evidence of the "recovery rate" (i.e. the "amount of
sugar that can be extracted from sugarcane"[6]) in
different States.[7] Regarding
the QEP, the complainants provide evidence of the total sugarcane production in
different States in India.[8] Using
these data, the complainants apply the paragraph 8 methodology to calculate the
total market price support that India provided to sugarcane producers for each
season from 2014-15 to 2018-19.[9]
[1] See para. 7.11 of the Panel Report. We recall that, for the reasons
explained in fn 75 to para. 7.9 of the Panel Report, it is unnecessary for us
to address the complainants' claims under Articles 3.2 and 6.3 of the Agreement
on Agriculture.
[2] See para. 7.19 of the Panel Report.
[3] Brazil's first written submission, para. 146; Australia's first
written submission, para. 161; Guatemala's first written submission, para. 146.
[4] Brazil's first written submission, para. 148; Brazil's Calculation
of India's Domestic Support for Sugarcane, (Exhibit BRA-1 (revised-3)),
"FERP" spreadsheet; Australia's first written submission, paras. 161‑162;
Australia's Domestic Support Calculations, (Exhibit AUS-1 (revised 23 March
2021)), "FERP" spreadsheet; Guatemala's first written submission,
para. 147; Guatemala's Calculations of India's AMS (Exhibit GTM-45 (revised 12
May 2021)), "FERP details" spreadsheet.
[5] Brazil's first written submission, paras. 24-48, 135-139 and 156;
Australia's first written submission, paras. 23-61 and 153-156; Guatemala's
first written submission, paras. 37-72 and 140-144.
[6] Guatemala's first written
submission, para. 40. See also Brazil's first written submission,
para. 32; Australia's first written submission, para. 28.
[7] Brazil's first written submission, Table C-1; Australia's first
written submission, Table 16; Guatemala's first written submission, Table 2.
[8] Brazil's first written submission, Table C-8; Australia's first
written submission, Table 17; Guatemala's first written submission, Table 8.
[9] See Brazil's Calculation of India's Domestic Support for Sugarcane,
(Exhibit BRA-1 (revised-3)); Australia's Domestic Support Calculations,
(Exhibit AUS-1 (revised 23 March 2021)); Guatemala's Calculations of India's
AMS (Exhibit GTM-45 (revised 12 May 2021)).