The main aim of the Agreement on Agriculture is the removal of trade distortions resulting from subsidies, price and market support, and other trade distorting supports; and eventually facilitate a fair, predictable and market-oriented agricultural trading system. The new rules and commitments are applied to: market access, domestic support and export subsidy. The newly committed tariffs and tariff quotas for all agricultural products became effective in 1995.

The Uruguay Round Agreement contained a time table for new negotiations on a number of topics. The Built-in Agenda asked for negotiations for continuing the process of substantial progressive reductions in support and protection in agriculture in 2000. The first draft of modalities on agriculture was circulated in February 2003, followed by a revision in March based on negotiators’ comments. The draft focused on bridging the differences – the search for the compromises that were necessary for a final draft. The Ministerial Draft suggested a very modest reduction in domestic subsidies in rich countries, little reduction in export subsidies and a little bit opening of rich country markets. The draft, finally, could not be adopted.

The efforts for negotiations on agriculture continued. The Ministers resolved to establish modalities no later than April 30, 2006 and to submit comprehensive draft Schedules based on these modalities on later than July 31, 2006. The trade negotiations took place at the Ministerial level in July 2008. The Chairman, Negotiation Committee (Agriculture Committee in Special Session) circulated among the Members a revised Draft of framework for modalities on agriculture dated 6^th December, 2008. This was the last draft on agricultural modalities. It could not be approved owing to divergence among the Member countries.

There is a definite failure on agricultural domestic support negotiations, since rich countries are not willing to abandon agricultural subsidies. This paper describes the negotiations on agriculture and analyses the reasons behind the failure of negotiations. It also discusses the road ahead for agricultural trade under WTO framework.

KEYWORDS: Agreement on Agriculture, Market Access, Domestic Support, Export Subsidy