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Last-ditch attempts to get India on board

Publication Date : 04-12-2013

 

Lobbying of India has intensified as the nation of 1 billion people holds the key to the credibility of the World Trade Organization’s (WTO) role in fostering negotiations on multilateral trade policies.

Diplomatic sources said that because decisions at the WTO could not be reached without the consent of the entire membership, India’s stance would be “make or break ” for the future of the global trade body.

“While the chance of getting India on board is slim, there have been at least some attempts at last-minute lobbying,” a senior diplomat told The Jakarta Post on Tuesday.

The crux of the debate is India’s programme of stockpiling subsidised grain and rice to ensure cheap food for its people.

Trading partners fear that the programme contravenes WTO rules that limit farm subsidies, and there are concerns that India will misuse the policy to export the food at cheaper prices, thus distorting the market.

Indian officials have refused to comment, saying that the world should wait for an official statement scheduled to be delivered by their Minister of Commerce and Industry Anand Sharma on the country’s stance at the WTO plenary session on Wednesday morning.

According to diplomats, the minister is unlikely to submit easily as India is holding an election next year. The food subsidy is a key element in the government’s bid to win a third term in office.

Adopting a conciliatory approach, Trade Minister Gita Wirjawan said that as an “honest broker”, Indonesia would in the next few days meet any members that could help bridge the remaining gap between trade facilitation and the agricultural subsidy issue.

Gita hinted that he had already received positive gestures from some African countries that, he claimed, might “affect the positions of India and the United States” regarding the two countries’ respective stances on trade facilitation issues.

Indonesia is also scheduled to approach other key players, such as China, and leaders of regional groupings, including Jamaica, which heads the African, Caribbean and Pacific (ACP) group, and Switzerland, which leads the G10.

European Union Trade Commissioner Karel de Gucht said that India had to find a solution because the subsidy policy could breach WTO rules. “[India’s position is] a little bit different from the overall perspective of emerging economies, which is, I believe, in favor of the mutual benefits.”

Despite the seemingly unattainable goal, WTO director general Roberto Azevedo reiterated that political calls would be necessary to bring the dissenting views to convergence.

“Members want the deal. It’s time to deliver. A successful outcome is possible. It’s now or never,” he said during the opening of the meeting.

Agricultural subsidies and the draft trade facilitation deal have become the main stumbling block in the WTO negotiations.

Despite the much-touted benefits of trade facilitation, sources in diplomatic circles have said that the deal might also pose risks to developing countries like Indonesia. Particularly regarding issues such as freedom of goods in transit and financial aid that developing countries should provide to least-developed countries.

President Susilo Bambang Yudhoyono called for deep engagement and greater flexibility from members to make significant progress in the negotiations. “Pursuing national interests at all costs, without flexibility or compromise, is doomed to failure. Such rigidity will lead to no outcome, where everyone loses,” Yudhoyono said.

“We’ll lose, not because the WTO will disappear, but because we will have lost an opportunity to make much-needed reforms. And I fear that should we let this opportunity slip, it will be developing countries that lose the most,” he said.

 

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