The Hindu : National : WTO pact on agriculture unlikely this year

Online edition of India's National Newspaper
Thursday, Apr 29, 2004

National

National

WTO pact on agriculture unlikely this year

By Sushma Ramachandran

NEW DELHI, APRIL 28. The prospects of an agreement on agriculture at the World Trade Organisation this year appear bleak, judging by the wide gap in the views of the developing and developed countries in the latest round of negotiations in Geneva.

Besides, countries like India are in the midst of an election and official sources point out that policy decisions can be taken only by a new government. Given these electoral compulsions, India has also decided not to send a Minister to attend the WTO mini-ministerial conference being held in London later this week.

The conference has been convened at the behest of the U.S. Trade Representative, Robert Zoellick, who is keen on bringing about some kind of an agreement as quickly as possible. India may send officials to the talks, but a meaningful participation is ruled out at this stage.

Sources say the highlight of the agriculture talks held earlier this month was the unity of the Group of 20 developing countries on key issues. The group forcefully rejected efforts of the developed countries to provide "trade baits" to break up the G-20, which includes India, Brazil, China and South Africa. Besides, there has been little progress in efforts to arrive at an agreement on issues such as reduction of export subsidies by the E.U. and the U.S. Neither are countries like India expected to give concessions on allowing easy imports of agricultural products that might affect its 650 million farmers.

The viewpoints of developed and developing economies thus remain widely divergent and officials do not expect a framework agreement on agriculture to be finalised by July. Later in the year, elections in the U.S. and several European countries will further stall the progress of negotiations.

Making a similar prediction, the Oxfam trade policy expert, Samar Verma, told The Hindu that the discussions were only on one aspect of the proposed agriculture agreement — the issue of access to markets by exporters of agricultural products. The critical and contentious issue of subsidies on agricultural production was yet to be taken up. So was the third aspect of domestic support provided to farmers.

Dr. Verma said the G-20 so far appeared to have succeeded not only in remaining united, but in pushing forward with its own proposals in the area of market access where the level of import duties is an important factor. The proposal made by the European Union and the U.S. on tariffs on agriculture products envisages an overall reduction on such import duties. According to developing countries, this does not take into account problems of low tariffs affecting farmers growing sensitive products like cotton or sugar.

He said the G-20 had thus proposed a formula which took into account the impact of high imports for certain sensitive commodities. Described as the "band" formula, because it grouped the products into bands for purposes of import duties, the proposal appears to have dominated the latest round of agriculture talks.

Referring to the unity of the G-20 at the talks, he said Brazil, Paraguay and Argentina went on record that they would not accept any trade concessions that could involve breaking the group.

The G-20 had been formed in the run up to the WTO Cancun ministerial conference last year as a reaction to the agreement reached by the E.U. and the U.S. on agriculture.

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