Rice: Congressional Trade Hearings Shine Spotlight on India’s Subsidy Violations

    Rice harvest. ©Debra L Ferguson Stock Photography

    This week, India’s egregious World Trade Organization (WTO) domestic support violations, particularly those related to rice subsidies, were put front and center for U.S. Trade Representative (USTR) Katherine Tai during two Congressional hearings.

    Ambassador Tai appeared on Wednesday before the House Committee on Ways and Means, which has jurisdiction over trade, and then on Thursday, before their counterpart, the Senate Committee on Finance. Both of her in-person trips to Capitol Hill were to highlight the President’s 2022 Trade Policy Agenda.

    Rep. Jason Smith (R-MO), directing comments to Ambassador Tai during Wednesday’s House Ways and Means Committee hearing said: “U.S. rice depends on a strong export market, but with India’s sheer export volume they have nearly full control over world prices, and as long as India keeps their finger on the scale, heavily subsidizing their rice industry from seed to the ship, U.S. [rice] producers cannot compete.”

    And on Thursday, during the Senate Finance Committee hearing, Sen. Bill Cassidy (R-LA) remarked to Ambassador Tai during his line of questioning that “[India] heavily subsidizes their rice, from even before the seed is planted, and our [rice] folks are competing against something which is being sold below cost because of heavy subsidies.”

    Both Members of Congress are staunch supporters of the U.S. rice industry and their comments to Ambassador Tai echo USA Rice’s trade stance. They both signed letters that were sent to USTR and USDA over the winter, encouraging the U.S. to initiate a dispute settlement case against India at the WTO.

    Ambassador Tai agreed that global rice trade is complicated, and said she and her staff at USTR are monitoring it.

    “It is important to note that the USTR Ambassador is not often called up to Capitol Hill for Congressional hearings, so every minute she spends on the record and in that spotlight is valuable,” said Bobby Hanks, Louisiana rice miller and Chair of both USA Rice and the USA Rice International Trade Policy Committee.

    “During these hearings, Members of Congress on these committees get just five minutes to make remarks, so the fact that Congressman Smith and Senator Cassidy prioritized rice is much appreciated by our industry.”

    India and other bad actors, such as China, Thailand, and Vietnam, continue to subsidize their rice producers at levels or in ways that violate their WTO domestic support commitments. In addition, many agricultural powerhouses, with India being the prime example, are now subsidizing their fertilizer and input costs. As a result, U.S. rice farmers, and the industry as a whole, continue to suffer as they try to compete at a disadvantage on the world market.

    Additionally, many members of both committees stressed the need for the Biden Administration to work expeditiously to fill two key agricultural trade positions, the chief agriculture negotiator at the Office of the U.S. Trade Representative and the Under Secretary for Trade and Foreign Affairs at the U.S. Department of Agriculture.

    “Agriculture needs to be at the table during trade conversations,” said Hanks. “We commend those Members of Congress who continue pushing for these critical administration positions to be filled.”

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