India Maintains Principled Stand at the WTO

August 01, 2014, New Delhi
As the World Trade Organisation (WTO) deadline for the Protocol on Amendment on Trade Facilitation Agreement (TFA) came and passed on 31st July, 2014 without agreement, India has remained steadfast on its position to a balanced approach to trade negotiations, especially addressing the issue of food stockholding.

“Every country guards its domestic interests zealously and India’s stance of pursuing parallel progress on trade facilitation and food security at the WTO is a principled step” said Pradeep S Mehta, Founder Secretary General of CUTS and member of the WTO’s High Level Panel on The Future of Trade (2013).

Mr. Mehta noted that both developing and developed countries need to sit down to find common ground for a roadmap on progress on public stockholding for food security purposes that would satisfy the developing countries who form the majority in the World Trade Organisation.

Although, while this would still have to be ironed out, he hoped that the summer break would provide members time to ponder upon a midway option and countries would be ready to start talking about such a deal in September, 2014.

At the WTO Bali Ministerial in December, 2013, the member countries had agreed to a global reform of customs procedures known as “trade facilitation”, but it still needed to be put into the WTO rule book by July 31, 2014.

While many member countries thought it would be a cakewalk, it turned out to be a more daunting task because India and other developing member countries declined to support it in the absence of a permanent solution for its concerns on food security.

These developing countries, led by India, opined that after months following the Bali Ministerial Conference in December 2013, little to no progress has been made on the other Bali decisions and focus has remained exclusively on trade facilitation, an agreement that many see as beneficially skewed in the favour of the developed countries. It is this modus operandi adopted to expedite the signing of the TFA which changes the balance of what was agreed in Bali.

India, therefore, is taking the stance for a parallel progress on trade facilitation, food security as well as issues concerning least developed countries at the WTO, which is a principally correct position. Otherwise, one issue will move forward while the others remain behind. Hence, India is doing the right thing by linking a permanent solution to food security with TFA.

India’s stance and the support by other member countries stems from a deeply embedded belief that the developed countries are apathetic to the suffering of the poor in developing and least developed countries. The history of trade negotiations shows that developed countries have pushed their own agenda and indulged in dilating on issues of poor countries by tiring them out with just talks and no solution.

Being an experienced negotiator from the GATT days and having known these tricks of the developed countries of all talk and no action on ground, India has pushed for progress to commence on finding a permanent solution well before the WTO Ministerial in 2017 rather than leaving it to the last minute.

Along with other WTO members, India’s stance on the matter has remained unimpeded, believing intensely that a solution is possible through the multilateral system. In Bali, India agreed to a ‘peace clause’ as per an assurance by the developed countries that there is, and will be, a balance among all three pillars of the Bali accord, however, it seems to be entirely missing.

Meanwhile, the US and other developed countries are attempting to weaken the multilateral trading system by pursuing preferential trade agreements. For instance, they are negotiating a Trans-Pacific Partnership without China or India, and a Trans-Atlantic Trade and Investment Partnership while alternatively pursuing a plurilateral agreement on services at the WTO, again without emerging countries participation.

Paradoxically, the farm accord as crafted in the Uruguay Round Agreements permitted developed countries, mainly the US and the EU, to subsidise their farmers through indirect means – means which developing countries do not currently possess. It is therefore in India’s interest, and the interest of its poor, to pursue the conclusion of the Doha Development Round more than any other member country.

In present circumstances, it is possible that many countries would blame India for retracting from the done deal at Bali on trade facilitation. However, it is noteworthy that India has not receded from the trade facilitation agreement, but is only seeking a balanced outcome that brings the decision on public stockholding for food security concerns on top of the agenda as well.

It has indeed echoed its commitment to a strong trade facilitation agreement provided that its food security concerns are addressed in a balanced manner.

Therefore, India’s position on pushing forward the protocol on trade facilitation beyond the end of July unless there is some demonstrated traction on food security, is righteous and represents concerns of billions of people in the developing world.

Nevertheless, it is hoped that members will be able to come to a balanced solution when the WTO resumes its work in September, 2014 and works in favour of the multilateral trading system.

For more information, please contact:
Pradeep S Mehta, +91.9829013131;
Bipul Chatterjee, +91(0)9829285921,