New Delhi: Following World Trade Organization (WTO) director general Pascal Lamy’s call on Wednesday for a group of ministers meet on 21 July to push the Doha round of global free trade talks, India’s commerce minister Kamal Nath said on Thursday that the country would not “agree to the overall conclusions” unless its “interests” were met.
The July meeting will include ministers representing a range of interests in the negotiations about Non-agriculture Market Access (Nama) and opening up agriculture.
Defiant stance: Kamal Nath, Union minister for commerce and industry. Photograph: Ramesh Pathania / Mint
Lamy is keen on finalizing the Doha Round in 2008.
However, countries remain deeply divided on issues. India has in the past strongly criticized the revised draft proposals on agriculture and Nama released by WTO on 19 May on the grounds that “they violate the Doha mandate” and “were aimed at dividing the developing countries”.
The draft proposals detail the level and extent of duty cuts and subsidies in different categories and provide a blueprint for negotiations at the ministerial level.
The country has singled out “four livelihood” issues on which India will not compromise: the special safeguard mechanism (SSM); special products in agriculture; subsidies given to the country’s small and marginal farmers; and the revised demands on “anti-concentration”.
SSM is an intervention that allows developing countries to protect domestic producers when imports cross a certain limit; special products refers to the number of agriculture products on which a developing country can ask for tariff relaxation.
The Doha round of trade negotiations began in 2001 in order to slash tariff barriers and promote trade globally.
After seven years and successive deadlocks, negotiations at WTO have reached a feverish pitch with many developed countries or trade blocs, especially the European Union and US, pushing for a quick conclusion of the Doha Round.
WTO formed a core group of 12 countries, including India, to narrow down differences in NAMA, as reported by Mint on 4 June.
“The current flashpoint in NAMA, which emerged out of the core group discussion in the last two weeks is about ‘anti-concentration’ demands from the developed countries,” said a senior commerce ministry official who did not wish to be identified.
These demands are about greater restrictions on developing with regards to protecting certain sectors from tariff cuts. According to Indian negotiators, India along with Malaysia, China, Mexico and Brazil opposed it initially. The official added that after they were promised some give-aways, Brazil and Mexico no longer oppose anti-concentration. “The proposed changes will hurt traditional Indian industries,”the official said
Manav Majumdar, who looks at trade issues at the Federation of Indian Chambers of Commerce and Industry, or Ficci, said increased demands on “anti-concentration” would badly hurt sectors where India employs a lot of people. “The micro, small and medium enterprises across the sectors will be affected adversely. In particular, sectors like auto and auto components, textile and clothing, marine products and electronic goods will be affected. We don’t want anti-concentration to reduce domestic employement potential,” he added.
A Delhi-based trade analyst, who did not wish to be identified said that while “technically” India can refuse to be part of a consensus at the ministerial meeting in Geneva, he was unsure if such a stand is realistic. “I think the G-8 summit next month will decide the fate of WTO negotiations too. Since the nuclear deal has fallen through, there will be increased pressure on India, especially from US, to work towards concluding the Doha Round,” he added.
He was referring to the Indo-US civilian nuclear agreement, whose fate seems to be hanging in balance with the government being unable to convince a key ally on the deal’s merits.