A file photo of Prime Minister Narendra Modi with US President Barack Obama. (PTI)
After months-long deadlock, the World Trade Organisation approved a framework for a global pact to ease customs norms after accepting India's demand to remove constraints on food stockpiling.
The approval comes days after the impasse between the US and India over food stockpiling was resolved through direct contact between US President Barack Obama and Prime Minister Narendra Modi on November 13.
This is the first major pact reached by WTO members since the multilateral trade body came into existence in 1995.
The agreement will now have to be ratified by governments of member countries and can come into effect sometime next year.
In July, India had refused to ratify the Trade Facilitation Agreement (TFA) - meant to ease customs norms - demanding that the WTO members find a permanent solution to the issue of public stockholding of foodgrain to feed its poor and an extension of the peace clause.
Under the peace clause, a WTO member is not penalised for breaching the food subsidy cap. A developing nation can provide food subsidy of upto 10% of its total farm output.
As per the Bali agreement, the peace clause was to continue till 2017. The extension will enable India to continue procurement and stocking of foodgrain for distribution to the poor under its food security programme without attracting any kind of action from WTO even if it breaches the 10% subsidy cap.
The TFA was being pushed by the US and other developed countries, which needed to boost their sagging economies through unhindered international trade.
"After the TFA got ratified by two-third of the members, it will come into effect for those countries," a source said.