The year 2005 gave a new lease of life to World Trade Organisation negotiations with trade negotiators managing to avert a failure at Hong Kong Ministerial Conference to produce a modest deal even as developing countries, including India, formed a united front to thwart any pressure from developed countries, altering balance of power at the world trade body.
India's alliance building skills were at their best as it managed to bring all the developing, least developed, small and vulnerable economy countries under the umbrella of G-110 as they pushed the agreement at Hong Kong, which for the first time was not dictated by the developed powers but brokered by this grand alliance.
After struggling for more than a year, convergence was still eluding the 149 members of the WTO as they met at Hong Kong with scaled-down expectations, but only some last minute hard bargaining could successfully break the deadlock on the contentious issues of agriculture, non-agriculture market access and duty-free quota free package for LDCs and secure the deal, which was credible.
India and the WTO: News and Issues
Playing a hard negotiator and a clever strategist, Minister of Commerce and Industry Kamal Nath wrested concessions from developed countries, getting 2013 as the end date of all export subsidies.
The agreement also addressed the domestic concerns of food and livelihood security of country's poor farmer by way of special products, which will be self designated and special safeguard mechanism with both price and volume triggers as also exemption to developing countries from making reductions in their farm support.
Hong Kong also put a clampdown on developed countries' tactic of shifting subsidies from one box to another to continue with them in another form by putting adequate provisions.
It also made it clear that food aid given by developed countries as also their export credits and State Trading
Enterprises will have to be disciplined, details of which will be finalised by April 30 next year.
On industrial goods, Indian industry, which had been on the tenterhooks with developed countries putting pressure for opening up of markets, heaved a sigh of relief as the much popular statement of 'less than full reciprocity' was admitted as a standalone provision in the Hong Kong package.
But before the Hong Kong deal was reached, WTO negotiations witnessed some hectic alliance building and formation of various groups.
Besides active engagement by G-33 and G-20, the talks saw the G-4 group of the US, EU, India and Brazil meeting at various locations like London, Brussels, Geneva to carry the negotiations forward.
Infact, India played host to the G-20 alliance of developing countries on agriculture and held the group's ministerial meeting here besides attending another in neighbouring Pakistan.
India also attended the key ministerial meetings of the G-33 alliance of Special Products and Special Safeguard Mechanism, the G-90 and Least Developed Countries in the run up to the Hong Kong Conference.
As it donned the role of a key player in the multilateral negotiations, India did not remain ignorant to its regional needs and deepened its engagement at this front also. The country forged several alliances and moved forward on Singapore Free Trade Agreement, South Asian Free Trade Agreement, ASEAN, Gulf Cooperation Council while outlining the vision of a pan-Asian presence.
The year saw several joint study groups meetings as India consciously turned its attention to intensify bilateral and regional engagements.
Various JSGs were set up like Indo-Korea, India-Mauritius, India-Australia, Indo-Russia, India-Israel finally forcing the prime minister to form a trade and economic erlations committee to outline and guide the country's trade engagement policy.
Though moving forward in leaps and bounds in its trade engagement, India has not shed its caution and proving to be a hard negotiator in the regional agreements as well, a fact established well by the ASEAN FTA, which witnessed dropping of early harvest programme and postponement of implementation date.
However, being a tough negotiator did not deter the country from its role as a developing nation and an emerging economy and decided too open its doors for the least developed countries of the African region.
Much to the displeasure of industry, India remained firm on this principle and played a good neighbour as it also moved forward to give market access to textiles from Pakistan and Bangladesh even as the coming year brings good news for the region with SAFTA coming into effect from January 1, 2006.
