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India unhappy with fresh WTO negotiating texts

Sandeep Joshi

NEW DELHI: India has expressed its dissatisfaction on the fresh World Trade Organisation negotiating texts on agriculture and industrial products for a global trade deal stating that it leaves India and other developing countries with little policy space to protect their farmers and nascent industries.

Released by the negotiating group on agriculture, the revised text proposes less number of products which India and other developing countries can protect from unrestricted imports from the agro exporting countries like the U.S., Canada and Australia. Similarly, India’s plea demanding protection for its small and medium industries has also been overlooked in the new draft.

Stating that pressure from the U.S. and European Union seems to have resulted in the new text that was not in favour of developing nations , official sources here said developed nations were now pushing hard to make bigger developing nations, particularly the powerful block BRIC — Brazil, Russia, India and China — to yield their market without diluting their (developed nations) stand.

India is particularly upset about the text on agriculture — Non-Agricultural Market Access (NAMA) text — that has set a limit on a safeguard mechanism for protecting its small and marginal farmers. It feels that all these steps would only affect completion of the Doha round of negotiations, launched in 2001 for a market-opening multilateral trade agreement, by the end of this year due to differences between the developed and developing nations. Interestingly, the talks were supposed to be concluded by 2004.

CII unhappy

Reacting sharply on the next text, the Confederation of Indian Industry (CII) has expressed its dissatisfaction on the new NAMA text saying that it “dilutes” some flexibilities available to developing nations.

Though the text was a comprehensive document and attempted to bring on board the views of all members, the trade-off between the coefficients and flexibilities as proposed in the new text go against the development dimension of the Doha declaration.

Negates objective

According to CII’s WTO and Trade Agreements Committee chairman R. Gopalakrishnan, the new limit on the total import value for flexibilities also negates the objective of having a document that will deliver on the development dimension.

CII is also of the view that the current set of coefficients provided to developed countries does not reflect the ambition in the Round. Incentivising sectoral negotiations, which have not been supported by developing nations, has not been a good step. CII does not support negotiations on tariff eliminations for a few sectors, Mr. Gopalakrishnan said.

Greater tariff cut

Similarly, the Federation of Indian Chambers of Commerce & Industry has also expressed disappointment with the WTO draft on NAMA modalities.

“The new text does not adequately reflect concerns of India and other developing countries. It has again failed to follow the Doha mandate of ‘less than full reciprocity’ in tariff reduction.

The suggested set of coefficients, if applied in tariff reduction formula, would result in relatively greater tariff cut for India and other developing members, compared with developed economies like the U.S. and the European Union. This would be in complete disregard to the Doha mandate which has categorically specified that the tariff reduction commitments would be comparatively lower for developing countries,” it said in a statement.

On agriculture, FICCI said the revised draft needs to be further strengthened to take care of the food security and livelihood concerns of poor and vulnerable farmers of India.

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