Keep intact development agenda of Doha: India to WTO

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New Delhi, Aug 12: Even as WTO chief Pascal Lamy on Tuesday, Aug 12 pitched for early conclusion of a new global trade deal, India warned that if the core objective of development in Doha round of trade talks was to change, it would be difficult to conclude a new international deal.

''Doha round was aimed at revival of the weakest (countries)...if Doha round has to change its objective then it will be difficult (to clinch a new global trade deal),'' Commerce and Industry Minister Kamal Nath told an international conference here. Besides World Trade Organisation (WTO) Director General Pascal Lamy, UNCTAD Secretary General Supachai Panitchpakdi also addressed the conference jointly organised by think tank CUTs International and Federation of Indian Chambers of Commerce and Industry (FICCI).

Speaking after Mr Lamy, who said Doha deal would bring down trade barriers by half and inject 150 billion dollars in to the world trade, Mr Nath said economic architecture will not be dictated by WTO alone but also by demographics and technologies, adding broadband has already brought about dramatic change in the business world.

The Minister said it is in the interests of developed countries to ensure a new global trade which ensured healthy economies in developing world.

Stating that India's imports increased by over 70 per cent and 33 per cent from the United States and the European Union in the last year over the previous one, Mr Nath asked if this import surge had been possible if Indian economy had remained weak. ''If this is not market access what is it?'' he asked.

Toughening stance on SSM to counter hard position taken by the developed countries , Mr Nath said," We (developing countries) are asked to pay to stop what they (developed countries) should not (trade distorting farm subsidies) be doing". He said the developed countries have also yet to come out on the cotton issue which was settled in the Hong Kong Declaration 2005. He asked how industry in countries like India would buy cotton from African farmers where the same is available at much less price from the US farmers because of heavy subsidy provided to them. He asked why chicken and eggs from the US are cheaper than in India and similarly why milk from the Europe is cheaper.

Mr Nath said the issue before the WTO was not merely of trade but also of equity as had been agreed during the Framework Agreement 2004 when UNCTED secretary general Supachai Panitchpakdi was Director General of the global trade body.

He also strongly pitched for opening of services which, he said, accounts for 53-54 per cent of India's GDP. But without naming the US, he said it took 15 years for India to set up a bank branch in one of the developed countries." We want opening up (of services sector) which is not negated by domestic barriers,"he said.

Stating that India "abandoned" Geneva talks because of attitude of developed countries, Mr Nath said " I cannot negotiate attitude and mindset." On the need to preserve what was on table in Geneva on July 29 when the talks collapsed, he said "Everything is not on the table....many things have yet to be negotiated." He, however, appreciated Pascal for bringing negotiators to the last mile." We must resume (talks) to cover the last mile... we must seize the moment," he added.

Mr Nath said if Doha round is treated only as the round meant for cutting traiffs, it would not lead to increase in trade and industrialisation of developing countries. While accepting Mr Lamy's agrument on keeping timelines in concluding the trade deal, he said bottomlines have also to be kept in view and made a strong pitch for getting remedy for developing countries to protect their poor farmers against import surge.

Virtually rejecting the developed countries' offer of 40 per cent increase in imports of farm products before remedial trigger could be activated by developing countries, Mr Nath said they wanted a remedy which could help prevent suicides by farmers. He asked if the developed countries could have an operational special safeguards (SSG), what prevented them from granting the same facility to developing countries under special safeguard mechanism (SSM).

The nine-day ministerial talks in Geneva collapsed on the issue of SSM as the developing and developed blocs failed to agree on it.

Mr Lamy said as much by stating there were divergent views on SSM, adding while developing countries wanted it as a safety net to protect their farmers, others wanted SSM to be subjected to certain conditions so that the measure did not hinder world trade.

The WTO chief, at the same time, maintained members wanted to "preserve" what had been achieved during the marathon talks from July 21 to July 29.

Claiming that technically there had been agreement in Geneva because those who participated in the negotiations represent 80 per cent of the world trade, Mr Lamy, however, admitted that political reality is different because of divergence on SSM.

The trade talks in Geneva on agriculture and non-agriculture market access (Nama or industrial products), which were deadlocked on July 25, were revived when Mr Lamy produced a compromise paper.

He said the US offer to cut trade-distorting subsidies to 14.5 billion dollars should have been accepted under a new deal, failing which the US farm subsidy bill, he added, could go up to 48 billion dollars as set under Uruguay round.

The WTO chief reiterated that developing countries would contribute one-third but benefit two-third from the 150 billion dollars worth growth in the global trade over the period of Doha agreement.

Earlier, Mr Panitchpakdi called for a ''non-discrimatory and equitable system of multilateral trading.'' Calling for strengthening Doha development round, the UN official said the world must settle the issue of commodities, particulary cotton. ''Tackling cotton issue could help establish trust between North and South.'' The US heavy subsidy to its cotton farmers was not discussed at the Geneva ministerial.

He sought an arrangement which could support productive sectors of the world economy.

On current food crisis in the world, he said sub-Saharan African, which was a net food exporters 20 years ago, has now become a net importer because of overwhelming dependence on market forces. Such forces, he said, have both positive and negative aspects.

Commonwealth Deputy Secretary General Ransford Smith expressed the hope that the Geneva failure was a temporary hiatus and talks would resume soon.

CUTS General Secretary Pradeep Mehta apprehended that downside of Geneva flop could lead to rise in protectionism.

FICCI Vice President Rajan Bharti Mittal strongly defended SSM, saying 65 per cent of India's population depend on agriculture as against only 3.2 per cent work force's dependence on it in the developed world as earlier stated by Mehta.

UNI

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