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New Round?  Maybe, but implementation up front, says India

by Chakravarthi Raghavan

Geneva, 10 Jan 2001 --   Indian Commerce and Industry Minister, Mr. Murasoli Maran bluntly told Mr. Mike Moore, Director-General of the World Trade Organization, who met him in New Delhi  Tuesday that there has to be full agreement before any new round could be launch at the next Ministerial Conference and that implementation issues must be resolved up front as a confidence-building measure.

According to Indian press reports, during a meeting with Moore, where there was a “candid exchange of views”, the Indian Minister underscored the importance of confidence-building measures to restore the credibility among developing countries of the WTO trading system as being a just and fair system.

Moore’s visit to India to meet Maran was intended to get Indian support for the new round that Moore is keen to get launched at the next Ministerial Conference (to be held this year).

While Moore claimed in India that the WTO and the General Council had spent long hours last year to resolve issues of implementation, the statements of several developing countries including India at the last General Council meeting made clear that the year-long efforts have not resulted in anything tangible to meet the concerns of the developing countries.

After almost a year-long preparatory process where the concerns of developing countries and their implementation proposals were ignored or sought to be brushed aside and rolled into a new round, the Seattle Ministerial Conference assembled in December 1999 without any agreed text, and the Ministers found themselves having to negotiate everything, with the majors trying to cook up something among themselves and force it on others.

No wonder the Seattle conference ended in a debacle.

Though trade officials say that the WTO has learnt from that experience, and that the Director-General has been trying to get prior agreement among members before trying to launch a new round at the next conference, there are few signs that the real causes of the failure have been understood and lessons learnt and that something more  than a cosmetic effort is being made.

The visit of Moore to India to meet Maran appears to be to persuade India to agree to a new round. Moore has obviously been attempting to win India’s support by playing up to its concerns that the many regional and sub-regional preferential trade agreements and arrangements (to which India is not a party) are creating a situation where India is facing some discrimination.

Moore and other trade officials have been trying to argue that the only solution to this situation is to launch a new WTO multilateral round (and undertake liberalisation within such a round in order to entice the majors to participate in multilateral arrangements, rather than regional and sub-regional ones).

At his meeting with Moore, the Indian Minister insisted on the importance of confidence-building measures and credible results in regard to the implementation issues. These should figure upfront  (meaning that they should not be one of the many issues for a New Round), Maran reportedly told Moore.

Any new round, involving a new agenda should be undertaken only after a broad consensus on accepting the new issues on the agenda for such a new round, the Indian Minister stressed. Maran is also reported to have made clear that “non-trade” issues must be kept out of the multilateral trade agenda, and that as far as India was concerned there would be no compromise on the issue of labour standards.

One of the compromises being mooted is of a ‘separate track’ to discuss labour and other social issues and involving the WTO, the ILO, and other bodies.

However, many trade observers of the developing world are chary of even such a compromise. They point to the experience of the Uruguay Round where issues discussed in separate tracks (first, the services issues, and later, after the 1989 mid-term review, the question of intellectual property norms and standards) were then brought into the WTO by misinterpreting the concept of a ‘single undertaking’ for the goods negotiations (in the Punta del Este Declaration) and forcing every participant to accept all the agreements.

While trade officials and Moore appear to suggest that the next meeting of the General Council (in April) to consider implementation issues would resolve the issues and concerns of developing countries (Moore himself voiced such a view at a media briefing in New Delhi), developing-country trade diplomats in Geneva are less confident.

At his meetings with Moore, the Indian Minister has expressed India’s commitment to the ongoing mandated negotiations in agriculture and services and the mandated reviews (as in TRIPS).

India is expected to put forward comprehensive proposals on agriculture before the March deadline for such proposals. The Indian stand for such negotiations and the proposals to be put forward were recently discussed at a meeting of agricultural and trade interests and farm experts, with high emphasis on issues of food security and rural employment.

In voicing these views, Maran reportedly told Moore that in agriculture, “sufficient flexibility” had to be ensured for Indian domestic policies to take care of India’s food security and rural employment concerns.

There has been growing agitation among farmers and political parties over the prospect of India removing quantitative restrictions on imports and freeing imports, and the prospect of subsidised exports from the industrial world flooding the Indian market and destabilising the rural economy.

The government of India has been feeling the heat of this agitation. In underscoring the importance of prior consensus before the next Conference, Maran said that India wanted the next ministerial meeting to succeed and did not want to go through the Seattle experience. But to enable success, the WTO has to undertake confidence-building measures to restore the credibility of the multilateral trading system among developing countries.

Moore also had meetings with industry and commerce, but did not get much support from them either. The Federation of Indian Chambers of Commerce and Industry (FICCI) officials with whom he met, appear to have told Moore that the implementation concerns raised by developing countries must first be resolved before rushing to launch any new round of trade liberalisation.

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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