Statement (A): Under the WTO obligations, it is not necessary to reduce subsidy in India's agriculture sector.
Reason (R): India is a developing country.
With reference to the above which of the following is the correct answer-
Code:
Correct Answer: (d) A is false, but R is true.
Solution:As per the Agreement on Agriculture (AOA) of the WTO, it was necessary to reduce (from the establishment of WTO) the export subsidy provided by developed countries to agriculture by at least 36% (by value) or by 21% (by volume) over six years (from 1986-1990 levels). For developing countries, the agreement required cuts were 24% (by value) and 14% (by volume) over ten years. For domestic support policies, subject to reduction commitments, the total support given in 1986-88, measured by the Total Aggregate Measure of Support (total AMS), had to reduced by 20% in developed countries and 13.3% in developing countries within six years and ten years respectively. Hence, statement is wrong while reason is correct.