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TRADE-INDIA: 'WTO Market Access Proposal Unacceptable'

Paranjoy Guha Thakurta

NEW DELHI, May 23 2008 (IPS) - India has raised strong objections to the draft negotiating document on non-agricultural market access (NAMA) on trade in industrial products, released Monday by the World Trade Organisation (WTO).

The document, senior government officials told IPS, needs to be completely rewritten before it becomes acceptable to developing countries.

The tone and tenor of the NAMA text, New Delhi argues, would make it impossible for the WTO’s Doha Round of talks to be concluded before the end of the year. Worse, a top official said the document adopts the old imperialist ploy of ‘divide and rule’ in seeking to divide developing countries by offering concessions to a few instead of them all.

In an interview with IPS, India’s commerce secretary Gopal K. Pillai said the NAMA document was "completely unacceptable". He added that it appeared that the head of the negotiating panel on NAMA in the WTO, Canadian Don Stephenson, had prepared his document under American pressure.

"The text of the NAMA paper would need to be drastically reworded before it becomes acceptable to not just India but developing countries in general," added Pillai, the most senior civil servant in the Indian Ministry of Commerce and Industry.

The WTO, which currently has 152 countries as its members, is meant to facilitate rules-based international trade that is fair and equitable. This body is currently in a state of limbo as the planet’s developed and developing nations just cannot seem to agree on how to reduce agricultural subsidies and step up trade in industrial products in a manner that is acceptable to most, if not all, countries.

Pillai was of the view that Stephenson was "totally confused" as the text of the NAMA document contained as many as 97 ‘square brackets’ – indicating areas that were yet to be negotiated – against 17 square brackets in an earlier text that had been circulated in February. "He (Stephenson) made a total mess out of it," said the senior bureaucrat without mincing his words.

He added that while the new WTO text on agriculture is "better than" the earlier negotiating paper, the two documents put together ignores the livelihood concerns of poor farmers and gives rich countries an advantage as far as cutting tariffs on industrial products is concerned.

Interestingly, the entire political class in India cutting across ideological divisions as well as independent academics and businesspersons are firmly behind the government’s position.

"While the agriculture document tries to address some of the livelihood concerns of small and marginal farmers in developing countries, the NAMA document asks developing countries to reduce tariffs on imported products by a far higher margin than what developed countries would," says Biswajit Dhar, head of the Centre for WTO Studies at the Indian Institute of Foreign Trade.

Simply put, rich countries were supposed to reduce customs duties relatively more than poor nations to allow easier entry for the goods produced by the latter to the former.

In an interview with IPS, Dhar said the NAMA document seeks to "reverse the basic philosophy behind the WTO’s Doha Round of talks which talks of ‘less than full reciprocity’ and ‘special and differential treatment’ being given to industrial products from developing countries".

Representatives of business associations concur with this position. "We want the Doha Round to conclude this year but it must reflect the ‘development’ objective that is integral to the process of trade liberalization," said T.S. Vishwanath, senior director and head of international trade policy at the Confederation of Indian Industry (CII).

In an interview with IPS, Vishwanath added that the new NAMA text does not reflect the development objective of the Doha Round. "We are hoping that in the coming months, we will see some progress in negotiations in a manner in which the concerns of developing countries are addressed," he said.

Others are not so optimistic. Dhar says it "appears unlikely that the differences between developed and developing countries on NAMA and agriculture will be resolved in the near future".

When asked whether he expected the Doha Round that started in November 2001 to conclude by the end of the year, the latest deadline for conclusion of the talks, Pillai said: "We are not worried about a deadline. No deal is better than a bad deal."

There is general consensus in India that developing countries should not capitulate before developed nations and open its doors wide to imports (including food imports) from rich countries without getting at least some major concessions in return. Right now that does not seem to be happening. Reeling under recessionary conditions, much of the developed world seems to be raising protectionist walls higher.

The other disquieting aspect of the negotiating document is that it seeks to divide developing countries by offering special "carve-out" concessions to certain countries like South Africa, Mexico and Venezuela and not to others.

Pillai sees this as a game plan of the rich countries in general and the US in particular that seeks to isolate India and China from the rest of the developing world. He is, however, confident that this game plan will not succeed and that developing countries would stand together as an united group during negotiations in the WTO.