MUMBAI:
The Reserve Bank has indicated that the World Trade Organisation's Agreement on agriculture hold no threat to Indian producers from imports.

In its report on currency and finance, RBI has said that in India the quantitative restrictions on agriculture imports, which were imposed for balance of payment considerations, have already been removed and imports have been placed on the open general licence list.

"In order to provide protection to domestic producers in case of a surge in imports, India can raise the tariffs within the bound ceilings. In case of a few products such as primary products, processed products and edible oils, India had earlier raised the tariffs (during 1999 and 2000) to protect the domestic producers," said the report.

In the case of other products, India has successfully revised the binding levels through negotiations. "However, India can take suitable measures under WTO's agreement on safeguards if there is a serious injury to domestic producers due to a surge in imports or if there is any such other threat," the RBI said.

The government will also not have to make any major policy changes to comply with the WTO prescriptions.

"India's domestic support to agriculture is well below the limit of 10 per cent of the value of agricultural produce and therefore India is not required to make any reduction in it at present. The subsidies given for the public distribution system (PDS) are basically to consumer subsidies and are exempt from WTO discipline. India's system of minimum support prices as also the provision of input subsidies to agriculture are not constrained by the agreement. Moreover, the agricultural development schemes can also be continued under the agreement on agriculture," said RBI.