Australia has indicated that it will initiate legal action against India at the WTO (World Trade Organization) over the latter’s sugar subsidies, as reported by Business Standard (BS). Australia has alleged that India’s subsidies have caused distress among its sugar producers and led to a ‘significant downturn’ in world sugar prices.

Australia’s Trade Minister, Simon Birmingham, said this latest development comes after negotiations with India on the issue yielded no results. “We have raised our industry's deeply held concerns on numerous occasions with senior levels of the Indian Government. We are disappointed our concerns haven't been addressed and now see little choice other than to ramp up our efforts to stand up for the rights of our cane farmers and sugar millers,” he noted.

Business Insider had noted in September 2018 that India, which is the world’s largest consumer of sugar, could also unseat Brazil as the world’s largest producer of the commodity. Sugar farmers in India are guaranteed an above-cost fair price from sugar mills. This has incentivised many other farmers to take to the crop.

However, due to scanty rainfall, India’s sugar production might be 7.4 per cent less than the forecast, Reuters reported. Sugar mills in India, which have surplus stock, have entered into contracts with Sri Lanka and Middle East countries, to export 8 lakh tonnes.

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