India, Brazil end dispute on sugar subsidy at WTO
Aug, 28, 2024 Posted by Gabriel MalheirosWeek 202435
Brazil and India, the biggest two sugar-producing countries in the world, are strengthening their collaboration in ethanol production technology, thus ending their trade dispute on sugar subsidies at the World Trade Organisation (WTO), Kenneth Felix Hacynski Nobrega, Ambassador of Brazil to India said.
“(Bilateral) relations are so good in many areas. We have started a dialogue focussing on ethanol, as it can be a way out of surplus (global) sugar production, which could depress prices,” Nobrega, told FE.
The chart below shows the sugar export volume at the Port of Santos, Brazil’s top sugar export port, between January 2021 and June 2024. The information was derived from DataLiner.
Sugar Export Volume from Santos | Jan 2021 – Jun 2024 | WTMT
Source: DataLiner (click here to request a demo)
Brazil, which launched its ethanol blending programme in 1975 to bolster energy security, has offered technological support to India. In September last year, on the sidelines of the G20 summit in India, the Global Biofuel Alliance was launched to boost output and demand of biofuel where Brazil has a key role.
In 2019, Brazil, Australia and Guatemala had approached WTO stating that India’s measures like providing fair and remunerative price (FRP) given to farmers were ‘inconsistent’ with global trade rules.
India has stated that the centre and state governments do not procure sugarcane from farmers and all the purchases as per FRP made by private sugar mills.
Nobrega said that currently there are several collaborations at various levels such as government to government (G2G), business to business (B2B) and business to government (B2G) for sharing technology to boost ethanol production in India.
According to Flavio Castellari, Director General, Ethanol Cluster, Brazil, 27% ethanol blending in gasoline has been achieved in the South American country since its launch of the biofuel programme. In addition 84% of cars have flexible-fuel engines which can run on any proportion of gasoline and ethanol
“Under the new policy to be approved, the blending of ethanol in gasoline is expected to go up to 30% while we are collaborating with India on various aspects of production of biofuel such as research and development and technology transfer,” Castellari said. He said out of the 40 billion litres of ethanol produced in the country annually, 80% produced from sugarcane and rest from the maize.
Currently, the blending percentage in petrol in India has touched 15.83% in July, 2024 and cumulative blending percentage has crossed 13% in the ongoing ethanol supply year (ESY) 2023-24 (November-October). The government is aiming to achieve a 20% ethanol blending target by 2025-26 ESY.
Meanwhile, Mauro Vieira, minister of foreign affairs, Brazil will visit India during August 25-28, 2024. Vieira and external affairs minister S Jaishankar will co-chair the 9th India-Brazil joint commission meeting on Tuesday and it aimed at boosting bilateral and multilateral cooperation across sectors including agriculture and livestock.
Ambassador Nobrega said in the last one year, 31 business delegations from Brazil have visited India to strengthen economic collaboration between both the countries. “There are discussions on attracting Indian investment in Brazil and Brazil’s investment in India in the field of sugarcane production,” he said.
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