Discuss the different types of subsidies and supports provided by the Government of India to agricultural sector. Examine the related issues pertaining to Agreement on Agriculture of World Trade Organisation (WTO). (Answer in 250 words)

- Discuss the different types of subsidies and supports provided by the Government of India to agricultural sector. Examine the related issues pertaining to Agreement on Agriculture of World Trade Organisation (WTO). (Answer in 250 words)
Introduction
Agricultural subsidies in India aim to ensure food security, farm viability and rural livelihoods, but several support measures are scrutinised under the WTO’s Agreement on Agriculture (AoA).
Body
Major Subsidies and Supports:
1. Input Subsidies: Subsidised fertilizers, electricity, irrigation, seeds and agricultural credit reduce production costs.
2. Price Support: Minimum Support Price (MSP) and government procurement protect farmers against sharp price declines.
3. Income Support: Schemes such as PM-KISAN provide direct income transfers.
4. Risk Support: PM Fasal Bima Yojana subsidises crop-insurance premiums.
5. Infrastructure Support: Investments in irrigation, warehouses, cold chains, agricultural research and extension raise productivity.
6. Export and Marketing Support: Assistance for transport, processing, FPOs and market access improves competitiveness.
Issues under WTO Agreement on Agriculture:
1. Amber Box: Trade-distorting support, including certain price and input subsidies, is subject to limits.
2. De minimis Limit: Developing countries may provide product-specific and non-product-specific support up to 10% of the value of agricultural production.
3. Green Box: Support for research, infrastructure, environmental programmes and certain income support is generally exempt from reduction commitments.
4. Public Stockholding Issue: India’s MSP-based procurement for food security may breach subsidy limits because WTO calculations use outdated 1986–88 reference prices.
5. The Peace Clause temporarily protects eligible public stockholding programmes from legal challenge, but India seeks a permanent solution.
6. Developed-country subsidies remain contentious, as their large support can distort global prices and disadvantage Indian farmers.
Conclusion
Thus, India must balance farmer welfare and food security with WTO obligations by shifting towards transparent, minimally trade-distorting and Green Box-compatible support.