Context: Recently, India has invoked the peace clause of the World Trade Organization for exceeding the ceiling on support it can offer farmers for rice for the marketing year 2018-2019, marking the first time any country has taken recourse to this safeguard.
Issue

• “India’s breach of commitment for rice, a traditional staple food crop… arises from support provided in pursuance of public stockholding programmes for food security purposes which were in existence as of the date of the Bali Ministerial Decision on Public Stockholding for Food Security Purposes.
• In its notification to the organisation, Govt.said that under its public stockholding programmes for food security purposes, rice, wheat, coarse cereals and pulses, among others, are acquired and released in order to meet the domestic food security needs of India’s poor and vulnerable population, and “not to impede commercial trade or food security of others.” 
• India is confident that it has met the conditions to be able to use the peace clause – and not distort trade or adversely affect the food security of other members – and that no country will raise a dispute.
• The peace clause protects a developing country’s food procurement programmes against action from WTO members in case subsidy ceilings are breached. High subsidies are seen to be distorting global trade.

About WHO Peace clause

• Peace clause’ available to India under the Bali agreement that says no member can take action against another on the food subsidy issue till a final agreement is reached on the issue, the deadline for which is the 11th ministerial in 2017.
• It is a mechanism which protects a developing country’s food procurement programmes against action from WTO members in case subsidy ceilings are breached (10% of the concerned crop’s value of production).
• It is available to the developing nations till a ‘permanent solution’ is found by the WTO members to the issue of public stockholding for food security purposes.