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Rediff.com  » Business » India may change its WTO stance, seek another package

India may change its WTO stance, seek another package

By Nayanima Basu
July 03, 2015 16:47 IST
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WTOIt may decide against single undertaking at Nairobi meeting

In a major change of stance, India might decide to settle for yet another package at the coming ministerial meeting of the World Trade Organization, similar to the Bali deal, through which some of its interests can be secured, instead of demanding the entire Doha Development Round be discussed.

A ministerial conference is the highest decision-making body of the WTO, after the General Council.

Here, trade ministers of all member countries meet to hammer out decisions of mutual interest.

The 10th ministerial conference, or MC10, will be held at Nairobi, Kenya from December 15-18.

The last such ministerial conference took place in Bali, Indonesia.

At that time, India was able to secure an interim measure for its food stockholding programme.

Among developing countries, India has always taken the lead on the principle of single undertaking.

In other words, it has always insisted on discussing the entire Doha Development Agenda, launched at the Qatari capital in November 2001 for tariff reduction in agriculture, as well as in industrial goods.

However, in a departure, India is now ready for another ‘Bali-type deal’ that will offer it, as well as other developing countries, potential gains, say officials in the commerce and industry ministry.

The Nairobi ministerial might give rise to yet another package that will seek to address the concerns of both developing and developed countries.

But the question is what could India demand that rich countries will be willing to offer?

This is also something being discussed at the WTO headquarters in Geneva.

Experts seem to be divided on the issue. Some say India should take on the risk of settling for yet another smaller package, which negates the very ethos of the Doha Development Agenda, only if it is confident it will get something in return.

“At a time when the US is focused on the Transpacific Partnership and the European Union is busy with its own set of problems, it will be impossible to get anything from them at this juncture.

“The Nairobi ministerial is going to be a damp squib. If India thinks it will be a successful round such as Bali, it is wrong because Bali was largely about securing a clarification, not an objective.

“India should not give into pressure from the US,” a former Indian ambassador to the WTO and its chief negotiator told Business Standard.

Another set of economists say though there is no harm in deviating from the concept of a single undertaking, India should first weigh the gains.

“India should look at closing the Doha round with lower levels of ambition. Some flexibility is required on the format of single undertaking.

“With 160 members, it isn’t possible to get everyone to agree on everything anymore. “So, what India can do now is demand liberalisation of agricultural trade and industrial tariffs, which, in a way, is the crux of the Doha round,” said Anwarul Hoda, professor at the Indian Council for Research on International Economic Relations and former deputy director-general of WTO.

According to Biswajit Dhar, professor of economics at Jawaharlal Nehru University, the situation is different today compared to 2013 ministerial conference in Bali. Besides, at that time, there were issues on which India could bargain for a beneficial package.

Dhar said though it did no harm to have a smaller package culled out of the Doha deal, India should tread carefully in making a list of demands.

DIFFERENT STROKES

  • Earlier, India had insisted on the concept of a single undertaking, which means either the whole Doha deal will be concluded or nothing will be considered complete
  • India believes as developed countries will not agree to discuss the entire Doha package, it is better to get some deal instead of nothing
  • Under the Bali package, India was able to secure an interim measure for its food stockpiling programme
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Nayanima Basu in New Delhi
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