US wants India to take initiative in breaking WTO deadlock

Washington, Feb 10 (UNI) The United States wants India to take a lead in reviving the global trade talks which broke down last July over the sensitive issue of farm subsidies.

''India's leadership is required to get a WTO agreement that will help the whole world and will help India as well,'' US Commerce Secretary Carlos Gutierrez said ahead of his departure to New Delhi tomorrow.

India, along with the European Union, Brazil and Japan had criticised the United States for the collapse of the talks six months ago. They were critical of the US for not improving its offer to reduce the amount of farm subsidies it would be permitted under global trade rules.

Besides the US refusal to reduce farm subsidies, the other contentious issue is Europe's unwillingness to wide open its agricultural markets. Meanwhile, there is some movement in the US which has raised hopes of some forward movement. Last month, the Bush administration proposed a reduction in its farm support programmes over the next five years by tying commodity subsidies to farmers' incomes.

The new farm bill that the administration has sent to Congress would make US farmers more competitive in the global agriculture market while tightening spending. It would help save 10 billion dollars, in part, by making farmers who earn more than a specified income ineligible for farm support payments.

The proposal would allow the United States to meet its WTO commitments, say analysts.

Secretary Gutierrez also insisted on freeing up trade in the manufacturing and service sectors for which India and other developing countries appear to be unwilling. India itself is reportedly diffident over opening its market to foreign agriculture products.

Gutierrez who will be in New Delhi from February 13-14 to meet senior Indian officials and business leaders will discuss ways to promote opportunity and economic growth between the two countries.

He will stress on officials the importance of India's full cooperation in advancing the Doha negotiations in the WTO, specifically efforts to liberalise trade in industrial and agricultural products as well as services.

Gutierrez noted that India is increasingly becoming a vital and important partner on matters of security and trade and that the country will become a key player going forward in the next Doha Round of trade talks.

The US is India's largest trading partner, and through November that partnership was worth 29 billion dollars in two-way trade. The US exports to India increased 25 per cent from January-November 2005 through January-November 2006, and investment is up 10 per cent.

UNI