Developing countries need to be flexible to break WTO deadlock

New Delhi, Apr 11 (UNI) A day ahead of the G-6 Trade Ministers' Meeting in the capital tomorrow, FICCI has called upon the developed countries to display adequate flexibility in the ongoing WTO negotiations.

''An improved offer by developed member-countries to reduce their trade-distorting farm subsidies and a more accommodating position on their part regarding special products and special safeguard mechanism would be critical to unlock the current impasse,'' FICCI President Habil Khorakiwala pointed out.

On agricultural support, since all Green Box subsidies do not meet the criteria of ''not or minimally distorting production and trade'', an important element of the Doha Round would be to review the Green Box support measures and tightening the disciplines so that transfer of substantial support amounts through ''box shifting'' is not possible, said FICCI.

In the context of non-agricultural market access (NAMA) negotiations, the chamber observed that India should resist the pressure for drastic reduction in tariffs.

Though there is still no agreement among members on ''coefficients'' which would apply for non-agricultural tariff cuts, FICCI is of the view that any unrealistically low coefficient for developing countries would force them to sharply lower their tariffs and too soon.

The tariff reduction process has to respect the Doha mandate of ''less than full reciprocity'' in favour of developing countries, and should also take into account the structural disadvantages faced by their trade and industry.

Also, countries like India would have to be fully entitled to 'paragraph 8 flexibilities'.

FICCI further pointed out that in the absence of any concrete progress on negotiations relating to Non-Tariff Barriers (NTBs) in WTO, greater market access for India's exports like textiles, leather and leather goods, chemicals, marine products, electrical and electronic goods would remain a pipedream.

Unless the issues on NTBs could be appropriately addressed under these negotiations, the world market share of our products cannot rise in line with their potential, FICCI stated.

In services, so far no significant liberalisation has been offered by developed countries in modes and areas of export interest to India, such as management and consultancy services, business services, engineering and medical services, architectural services and IT services among others.

Services exports from India are growing at the rate of 28 per cent for the last five years or so, FICCI said.

UNI