Indian trade experts said on Tuesday they agree with WTO Chief Pascal Lamy's prognosis that the world food crisis can be resolved through a global trade agreement that centers around correcting free market distortions.
Director General of the World Trade Organisation had stated early this month that the current food crisis can be solved through a successful outcome of the Doha Round of negotiations for a multi-lateral trade deal among 151 countries.
"Although the WTO cannot provide anything immediate to help solve the current crisis, it can, through the Doha Round negotiations, provide medium to long-term solutions. A WTO deal could help soften the impact of high prices by tackling the systemic distortions in the international market for food," Lamy had said.
Biswajit Dhar, head of the Centre for WTO Studies, Indian Institute of Foreign Trade, felt that if an agreement is reached it would provide certainty in terms of policy regime for the farmers in developing countries.
"A fair trade will encourage farmers from the developing countries to invest more in expanding agriculture production," he said.
However, if the existing distortions which include heavy subsidies to the rich farmers in the developed countries prevail, the agriculturalists in countries like India, Brazil, South Africa, Pakistan and China would shy away from expanding their produce.
"The Doha deal will improve viability of agriculture," Dhar said.
He said farmers would also be sure about not being thrown out of the market by the foreign agricultural produce swarming their markets.
Secretary General of the Federation of Indian Chambers of Commerce and Industry Amit Mitra said if a new multilateral deal is achieved without much delay "it will bring an end to subsidies and the distortions could be lessened, if not eliminated".
Removal of artificial barriers and subsidies would encourage more investment, "which is the only long-term sustainable solution to meet the growing food demand".
The world food market is witnessing an unprecedented escalation in food prices which had negative effects particularly on developing countries that depend on imports for their food security or are net food buyers.
Negotiations for an international agreement on trade were launched at Doha in 2001 with the mandate for completion by the end of 2004, but no consensus has been reached even three years after the deadline.