Concept: Special Safeguard Mechanism (SSM)
Topic: Indian Economy
Category: Issues related to direct and indirect farm subsidies and minimum support prices
CNA mentions: 1(Feb 27)
WTO and related topics are important for the UPSC civil services exam. It is important from an International Relations perspective. Also, these issues frequently feature in the news. So, they are important for current affairs in the IAS exam as well.
A Special Safeguard Mechanism (SSM) is a protectionist tool under WTO that will allow developing countries to increase tariffs temporarily to suppress import surges or price falls. It is especially used for agricultural imports that cause damages to the country’s farmers. The major proponents of the SSM are the G33 bloc of developing nations. SSM is an area of conflict in the WTO with some parties claiming that SSM could be used repeatedly which will distort trade. The SSM is allowed only for developing countries. It was a result of the Doha Ministerial Conference.
The SSM is on top of the existing safeguards like the SSG or Special Agricultural Safeguard. The main difference between the SSM and the SSG is that SSM is allowed only for the developing nations whereas the SSG exists for all countries that are part of the World Trade Organisation (WTO). SSG was part of GATT before it passed on to become part of the WTO. The SSM was put in place during the Doha Ministerial Conference held in 2001. During the discussions in the Doha MC, there were major points of conflict between the developing and developed nations, particularly between powerful negotiators India and the US. The g33 bloc supported India’s stand for higher level of tariff and lower import surge for making the SSM. Brazil, though a developing country, but a major agricultural importing country supported the USA’s stand which was opposed to India’s.