Agreement on Agriculture: Issues of Market Access for South Asian Countries

Abstract

The Uruguay Round achieved a historic turning point in the reform of agricultural trade system through adoption of the Agreement on Agriculture (AoA). The AoA lays firm foundation for strengthening multilateral discipline on agriculture trade by bringing the agriculture sector under GATT disciplines. It prohibits the use of non-tariff barriers and obliges members to reduce tariff barriers in the agriculture sector, and also establishes rules to restrain the use of domestic policy measures in the form of domestic support and export subsidies that have trade-distorting effects. Against these backgrounds, the paper delves into critical assessment of opportunities emanating from the AoA for the export of agriculture products by South Asian countries. The paper shows that member countries, in particular developed ones altogether, have not respected the agreement fully and faithfully, and tend to exploit the grey areas of the text to deny market access. As a result, new threats have been emerged. Since the agricultural export structure of South Asian countries are highly concentrated in a few products and markets, market access conditions even for few products would play a decisive role in terms of their export development potentials. The paper suggests that the ongoing negotiation on agriculture is an opportune venue for South Asia to correct the unbalanced provisions and modalities of implementation, and tilt the international agriculture market in their favour. For this, South Asian countries need to devise a common minimum position and put forward such position collectively along with forging issue-based alliances with other countries/groups. Given the limited usage of domestic supports and export subsidies coupled with fiscal constraints to introduce new ones, the level ofdispar ities in bound and applied tariffs of South Asian countries, the depth of market access barriers in other WTO members and the extent of price fluctuation ofagri cultural products in international market, the paper argue that South Asian coun tries should focus aggressively on expanding market access opportunities for their exportable products in the negotiations rather than protecting domestic market except for rural development and food security concern.