India, US can fix poultry issue via WTO's compliance panel

July 29, 2016

NEW DELHI: India can approach the World Trade Organization's compliance panel to preempt the US from imposing trade sanctions following its allegation that India failed to comply with the intergovernmental organisation's ruling on American poultry imports, according to a senior official. 

Last year, the WTO had ruled that India's ban on poultry shipments from the US was not tenable. Although India followed it up by issuing a notification on the requirements for poultry and poultry product imports from countries reporting outbreak of avian influenza, the US has been maintaining that India failed to comply with the WTO's ruling, and has threatened to use retaliatory measures against it. 

Under WTO rules, any disagreement related to compliance is decided by the WTO's compliance panel. 

"This is the logical step for India to show that the measure conforms to WTO (rules)," the official cited earlier said, adding that the two parties will have to ink a sequencing agreement to achieve this. The agreement will ensure that the US refrains from imposing trade sanctions on India and does not retaliate through any other route. 

"It will be of mutual advantage to get into a sequencing agreement, now that the implementing measure is in place," said Abhijit Das, head of the Centre for WTO Studies at Indian Institute of Foreign Trade. 

As per the notification dated July 8, the government has said that import of poultry and poultry products will be allowed from countries free from avian influenza in accordance with the norms set by World Organization for Animal Health. 

Apart from that, the government has issued guidelines on import. "We have sent a questionnaire to USA to know about the animal health services, legislation, poultry industry, disease, avian influenza, laboratory network, meat processing units, etc.," the official said, adding that they might visit the US to inspect the processing units. 

India is the fourth-largest producer of chicken meat in the world after the US, China and Brazil, with production touching 3.5-4 million tonnes a year. Organised players like Godrej Tyson, Suguna, Venky's and Alchemist have been expanding their retail base, apart from augmenting capacities. 

The per capita consumption of chicken in India has been on the rise, with eating habits changing predominantly in the metro cities. 

In 2006, US-based Tyson Foods entered the Indian market through a joint venture with Godrej. In the 1980s, US poultry breeding company Cobb had a joint venture with Venkateshwara Hatcheries, which sells meat under the Venkys brand. Also, the Aviagen Group, the world's premier poultry breeder, had set up an integrated backend processing plant in Coimbatore.