The Hindu : Business : India may make revised offer under GATS

Online edition of India's National Newspaper
Wednesday, May 25, 2005

Business

Business

India may make revised offer under GATS

Special Correspondent

Group of Ministers on agriculture issues mooted

NEW DELHI: The Union Commerce Ministry plans to seek Cabinet approval for a revised and more ambitious offer to the World Trade Organisation (WTO) on services. It is expected to approach the Cabinet Committee on WTO this week, according to the Commerce Secretary, S. N. Menon.

Mr. Menon said the offer under the General Agreement on Trade in Services (GATS) would be presented to the WTO as soon as the Cabinet cleared it, to meet the deadline of May 31 for such offers. Speaking at a workshop on WTO for State government officials organised by the Ministry, he pointed out that India had `offensive interests' in liberalising the services market, especially in what are known as Mode 1 and Mode 4. Under WTO terminology, Mode 1 refers to cross-border supply of services, including business process outsourcing (BPO) and Mode 4 pertains to supply of services by movement of natural persons.

Mr. Menon said the revised offer might be more ambitious than the previous one. As India had also received requests from other member countries for opening up of sectors such as insurance, legal services and accountancy, it might be able to negotiate better deals by making more aggressive offers in Mode 1 and Mode 4.

The Commerce Secretary said the Ministry might also suggest setting up of a Group of Ministers to consider the sensitive issue of agriculture as well as non-agriculture market access.

He felt that the next few months would witness intense negotiating activities in the run-up to the Hong Kong ministerial. Outlining India's priorities in the agriculture negotiations, he said it was seeking removal of trade distorting subsidies, reduction in the level of protection in developed nations and adequate protection to low income, poor and subsistence farmers in the country.

He also urged State governments to ensure that local policies were fully consistent with India's WTO obligations.

States would also have to put in place an institutional mechanism to implement WTO obligations, he said.

In his welcome address, the Director of the Indian Institute of Foreign Trade, Prabir Sengupta, said trade-distorting subsidies in agriculture by developed countries create a serious imbalance adversely affecting the developing countries.

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