Washington Insider -- Thursday

WTO Rules Against India's Import Bans

Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.

GOP Sees 'Collusion' Between EPA, Environmental Group

Republicans on the Senate Environment and Public Works Committee this week released a series of emails exchanged between the Environmental Protection Agency and the National Resources Defense Council that the senators say shows "collusion" between the two during the drafting of carbon emissions standards for power plants and other major rules.

The emails were obtained during an investigation led by Sen. David Vitter, R-La., and House Committee on Oversight and Government Reform Chairman Darrell Issa, R-Calif., into allegations that the NRDC played an outsized role in the development of the power plant rule.

EPA spokeswoman Liz Purchia told the press that the Clean Power Plan was developed through "extensive public outreach" that included consultation with states, power companies, local communities, environmental groups, associations, labor groups and tribes. "This is a flawed narrative driven by cherry-picked and isolated communications that in no way reflect the full breadth and depth of the unprecedented outreach EPA engaged in to formulate and develop the Clean Power Plan," Purchia said in an email.

EPA does not develop its rules without a public comment period that allows all viewpoints to be heard and considered. Whether environmental groups play an "outsized role" in the drafting of environmental regulations undoubtedly will be the subject of congressional hearings during the next Congress.

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Long Delay in Announcing Renewable Fuels Mandate Draining Certainty from Predictions

Usually reliable contacts earlier said they believed the Environmental Protection Agency would issue the 2014 Renewable Fuels Standard for corn-based ethanol at or around 13.6 billion gallons. However, the administration's long delay in making the announcement (it was due at the end of November 2013) has shaken the confidence in that prediction.

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In recent days, for example, there have been indications that at least the corn-based ethanol level could be below the level earlier predicted, with some sources saying the level could be affected by the lateness of the announcement. Another said the administration appears to be in "midterm election mode" and thus does not want to say anything that would affect a candidate.

EPA has said it would announce the 2015 RFS volume requirements next February. If the agency meets that self-imposed deadline, it would be a rarity.

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Washington Insider: WTO Rules Against India's Import Bans

The extent to which the United States has moved away from its former — even traditional — role in the fight for better global trade access was highlighted this week by the prominent press treatment given to the World Trade Organization's ruling against India's ban on various U.S. agricultural products, including poultry meat, eggs and live pigs. The Indian government argued that the bans were to protect against avian influenza, but the settlement panel found that they were unsupported by scientific evidence.

For over seven years, India has claimed the need to restrict various U.S. agricultural products to help control avian influenza. That justification has always seemed strange because the United States has not had an outbreak of high pathogenic avian influenza (HPAI) since 2004, while India has had more than 90 HPAI outbreaks.

The only other type of avian influenza detected in the United States since 2004 is low pathogenic avian influenza, which is often symptomless but turns up in the global health statistics mainly because of the highly sophisticated surveillance systems used to detect U.S. animal diseases.

The United States has frequently made the case to India that, as reflected in relevant international standards, there is no scientific basis to ban imports of these U.S. products. In fact, most observers have concluded for some time that the Indian government's bans were heavily based on protectionism — and noted that the government there frequently constrains trade on the basis of only very shaky sanitary-phytosanitary regulations.

The U.S. poultry industry, with its nearly 50,000 family farms, says it has been especially harmed by the Indian bans. It estimates that U.S. exports to India of poultry meat alone could easily exceed $300 million a year once India's restrictions are removed. That demand is expected to increase substantially in the future as India's demand for high quality protein increases.

The United States initiated this dispute by requesting consultations with India in March of 2012. After that approach proved unsuccessful in resolving U.S. concerns, a WTO panel was requested to hear claims that India's avian influenza restrictions are inconsistent with the country's WTO obligations.

In its report, the WTO panel found for the United States. It concluded that India breached its obligations under the WTO Agreement on the Application of Sanitary and Phytosanitary Measures because its restrictions were not based on international standards or a risk assessment that takes into account available scientific evidence. As a result, the restrictions were found to constitute a disguised impediment on international trade.

As expected, the decision was widely supported by U.S. producers and the administration. U.S. Trade Representative Michael Froman called it "a major victory for American farmers" and noted that "This is the fourth major WTO victory the U.S. has announced this year as we continue to unlock economic opportunity for our workers, farmers, and businesses."

At the same time, neither the politicians nor the administration noted another statistic that concerns trade tensions with U.S. trading partners in numerous markets. While Indian obstructions in the Doha Round have undercut those talks to an important degree, the U.S. failure to provide "fast track" authority to the administration and to avoid protectionist policies at home also could cause problems for those talks. Thus USTR Froman's comments about recent WTO victories, while well-grounded in this case, need to be seen as only one instance of recalcitrance on the trade front, Washington Insider believes.


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(GH/CZ)

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