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Shri Kamal Nath, Union Minister of Commerce and Industry, has ruled out the possibility of trade-offs between agriculture and other areas of negotiations in the World Trade Organisation (WTO) negotiations, given the critical role agriculture sector plays in India’s economy. Inaugurating the three-day Consultation on the WTO Framework Agreement of July 2004: The Way Forward, organised by the United Nations Conference on Trade and Development (UNCTAD) here today, Shri Kamal Nath gave a clear indication of India’s approach in the post Framework WTO negotiations that are to commence shortly, particularly in the key areas of non-agricultural market access (NAMA) and services, besides agriculture. "We need to safeguard our concerns and identify our offensive interests, and our needs and priorities in these areas. We need to deliberate on what is suitable in the Indian context, what kind of ambition level we should have when we talk of taking on commitments and how to dovetail our ongoing autonomous policies and programmes in the context of the WTO negotiations. We need to assess what would help our business, trade and industry. The window of opportunity cannot be successfully exploited without concrete inputs of business, trade, industry and civil society in general", he said summing up India’s WTO strategy in the coming months. A lot of hard work would have to be done in the next 13 months so that something concrete could emerge by the time of the next WTO Ministerial in Hong Kong in December 2005, the Minister said, adding that he was delighted to be ‘kicking off’ the post-Framework debate in India today.
Shri G.K. Pillai, Additional Secretary, Ministry of Commerce & Industry; Ms. Lakshmi Puri, Director, Division of International Trade in Goods, Services and Commodities, UNCTAD/Geneva; Dr. Charlotte Seymour-Smith, Country Head/DFID; Dr. Veena Jha, Project Coordinator, UNCTAD-India; and a host of other experts in international trade from India and abroad along with senior officials of Ministry of Commerce & Industry participated in the inaugural session.
On Agriculture, Shri Kamal Nath said that there should be effective and substantial reductions in domestic support provided by developed countries to their farm sector, which distorted production and prices. He also called for setting an early date for complete elimination of export subsidies in any form, without resorting to the tactic of backloading the commitments or creating loopholes in the guise of food aid concerns. Agricultural subsidies in all OECD countries put together amounted to one billion US dollars a day, while a developing country like India was able to provide a meagre one dollar per month per farmer in the form of minimum agricultural support, he pointed out. The focus should be not just on market access into developing countries by getting them to lower tariffs but equal importance should be given to market access commitments by developed countries to ensure wider distribution of benefits for all the people. "When we speak of market access we should not talk only of tariffs, but also about how to deal with non-tariff barriers" as NTBs would assume greater importance than tariffs and quotas in the days to come, he said. Tariff negotiations should reflect "what we see as key features of the Doha mandate, namely ‘special & differential treatment’ and ‘less than full reciprocity’. If the intention is to have a formula that is aimed at harmonisation, then I am afraid that it will not wash – since harmonisation is only another name for getting developing countries to do more than developed ones – which is the exact opposite of S&DT and the ‘less than full reciprocity’ principle", he stressed.
Shri Kamal Nath said that flexibilities for developing countries would be important in the NAMA negotiations and these should address this specific development needs of all developing countries. Referring to the proposal on the table to bring down tariffs to zero by all countries – both developed and developing – in seven sectors of export interest to developing countries viz., fish products, leather, footwear, textiles, jewellery, electronic goods and auto components, Shri Kamal Nath said that while India welcomed the sectoral iniaitatives in view of the considerable scope for enhanced trade in these areas, he made it clear that participation in the sectoral initiatives must be voluntary and not mandatory.
Services would be an area of offensive interest for India, in view of her specific strengths and comparative advantages. India has already made its request for liberalisation in respect of Modes 1 and 4, adding that one of the few specifics in the July package was the last date for revised offers which had been fixed as May 2005.
Trade facilitation, the Minister said, would help in getting Indian exports facilitated in foreign ports, besides which, India had also been successful in introducing an entirely new element in the modalities, namely that of having an effective customs cooperation mechanism on issues relating to trade facilitation. Other development related issues like Implementation and Special & Differential Treatment provisions must also be thoroughly discussed, he said.
Shri Pillai said that the Framework Agreement of July was more well defined than the Doha mandate, but it didn’t contain the modalities i.e., the numbers and other details which were yet to be negotiated. Ms. Charlotte Seymour-Smith underlined the commitment of UK government to a good outcome for developing countries from the Doha Round and said there was a huge amount of work to be done before the Hong Kong Ministerial. She said UK would hold the presidency of EU and G-8 in 2005 and it would make trade a priority. Ms. Lakshmi Puri said the UNCTAD Trade and Development Board review recently identified the lessons learnt from Cancun and acknowledged the positive role of UNCTAD XI in consensus building and in ensuring an open and equitable multilateral trading system. The Framework Agreement, in UNCTAD’s assessment, signalled a revival of hope and a new kind of balance, whereby the developing countries interests would have to be taken into account for moving the Doha Round forward. The new geography of international trade involving developing countries had emerged, and the principle of assuring gains from trade for all developing countries had been recognised, she said. Dr. Veena Jha outlined the components of the Project on "Strategies and Preparedness for Trade and Globalisation in India" under the aegis of which the three-day Consultations are being held.
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