Dametto welcomes sugar subsidy escalation

Hinchinbrook MP Nick Dametto has welcomed the Federal Government’s decision to initiate formal action through the World Trade Organisation against India’s sugar subsidies is a welcome move for local growers.

THE Federal Government’s decision to initiate formal action through the World Trade Organisation (WTO) against India’s sugar subsidies is a welcome move for local growers, says Hinchinbrook MP Nick Dametto.

Mr Dametto said the formal WTO action, which was jointly launched with the Brazilian Government, will send a clear signal to India that such practices will not be tolerated in what should be a fair world market.

“We know India’s actions have been depressing the global sugar price for some time and are making it extremely hard for Australian growers and millers to compete,” he said.

“This is a strong message that Australia has sent to not only India but other trade partners to ensure that our growers are getting the best opportunity to export their sugar on a level playing field.”

The latest action follows the government’s decision to lodge a counter-notification notice against India last November, a precursor to launching the formal WTO dispute settlement process.

The counter-notification, which attracted the support of 13 other countries, covered subsidies paid by the Indian Government to its sugar industry between 2011-12 and 2016-17 and outlined the basis of Australia’s claims that India is breaching its WTO obligations.

“It took a relentless lobbying effort from Katter’s Australian Party’s Federal and State members to convince the government to take that first step last year, which quite frankly, should have been done much sooner,” Mr Dametto said.

“Analysis by both government and the Australian Sugar Milling Council indicates there is a strong case against Indian sugar support mechanisms and that India is clear breach of its WTO obligations.

“Unless significant reforms happen, we will continue to see India dump millions of tonnes of subsidised sugar on to the world market that will send global prices into a freefall.”

When the Indian government confirmed in late September 2018 that it would dump five million tonnes of subsidised sugar onto the world market, prices fell by $14 per tonne overnight to be just on $300 per tonne at the time.

“According to Canegrowers, India’s sugar industry is getting the equivalent of an $850 million government assistance package, including help to export their product,” Mr Dametto said.

Hinchinbrook is home to a sugar industry worth more than $300 million a year which is part of an Australian export industry worth $1.8 billion per year to the economy.