Australia wins World Trade Organization case against Indian sugar export subsidies

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Australian canegrowers have triumphed in a long-running legal battle against Indian export sugar subsidies, estimated to have cost the industry $1 billion in revenue.  

Along with Brazil and Guatemala, Australia brought the case to the World Trade Organization (WTO) in 2019.

The WTO found India’s export subsidies were prohibited under trading rules and recommended their removal.

The panel also found that India’s levels of sugarcane price supports had consistently exceeded permitted levels.

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Peak national sugar industry organisations the Australian Sugar Milling Council (ASMC) and CANEGROWERS allege the subsidies caused a glut in the global market, leading to a significant drop in international prices. 

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“The WTO Panel hearing this case has unequivocally found in favour of Australia, Brazil and Guatemala,” Mr Schembri said. 

“I am proud that CANEGROWERS and ASMC – on behalf of all growers and millers in the Australian industry – stood up for a rules-based world trading regime and we have been vindicated.”

ASMC Director of Policy, Economics and Trade, David Rynne said India’s subsidies and the export of its surplus sugar are calculated to have cost Australian cane growers and sugar millers $1 billion in revenue between 2017-18 and 2020-21.

“We now call on India, the government and the industry, to work together to comply with the WTO’s rulings and bring its activities back into line with international trade rules,” Mr Rynne said. 

While appeal processes are yet to be worked through, Minister for Trade, Tourism and Investment Dan Tehan has welcomed the WTO’s ruling.

“The Australian Government welcomes the decision of the World Trade Organization (WTO) on India’s price support for sugarcane and export subsidies for sugar,” he said.

“[We’re] committed to working with WTO Members to progress agricultural reform which opens markets and reduces global distortions.”

Earlier this year, Australia jumped ahead of Thailand to become the world’s second-largest exporter of raw sugar, next to Brazil.

As Australia typically exports 85 per cent of its sugar production, the industry is heavily reliant on a stable global market.