Gloom at WTO as India stands firm on food
India said yesterday it could not accept a World Trade Organisation (WTO) proposal on food security, casting a gloom over a high-stakes conference tasked with salvaging the body’s faltering efforts to liberalise world trade.
A proposal that New Delhi feels could endanger its efforts to subsidise food in the huge nation “cannot be accepted”, India’s Commerce Minister Anand Sharma told his counterparts on the Indonesian resort island of Bali.
“Agriculture sustains millions of subsistence farmers. Their interests must be secured. Food security is essential for four billion people of the world,” he said.
“Yes, we have rejected it,” he later told reporters, calling it a “final decision”.
His comments appeared to imperil WTO chief Roberto Azevedo’s hopes that delegates can agree on a modest package of measures to keep alive the multilateral organisation’s stumbling 12-year-old drive to slash trade barriers.
One by one, delegates to the four-day conference warned that Bali could be the last chance to rescue the WTO’s vision of an open trading environment fair to both rich and poor countries.
“Leaving Bali this week without an agreement would deal a debilitating blow to the WTO as a forum for multilateral negotiations,” US Trade Representative Michael Froman said.
“And if that happens, the unfortunate truth is that the loss would be felt most heavily by those members who can least afford it.”
The WTO launched the “Doha Round” of talks in Qatar in 2001, seeking to overhaul the world trading system by setting a global framework of rules and tearing down barriers.
But protectionist disputes between rich and poor countries -- as well as the WTO’s insistence that any accord be unanimous -- has made a deal frustratingly elusive.
Meanwhile, alternative regional pacts between major trading nations including the 12-nation Trans-Pacific Partnership (TPP) pushed by Washington have emerged, threatening the WTO with obsolescence.
Azevedo has said it would be “tragic” if such arrangements carry the day, saying they cannot ensure the interests of the world’s poorest countries are taken into account.
Chances for success in Bali have increasingly centred on India’s position on food security.
India passed a landmark National Food Security Act in August that will expand the buying of grain from farmers at subsidised rates, and sell it to consumers at prices reduced even further.
Facing tough elections next year and pressure from powerful farmers’ unions and opposition parties, the ruling Congress Party government has hardened its stand on the issue.
It fears that a WTO rule limiting subsidies to no more than 10 percent of agricultural production could threaten its efforts to feed its legions of poor.
The Bali package would exempt India from any WTO challenges on subsidies for about four years, but New Delhi wants a blanket exemption until a permanent solution can be negotiated.
Pulling back from the Doha Round’s lofty goals, the “Bali package” being considered this week focuses on a few specific issues including the agricultural subsidies, proposals to simplify customs procedures, and measures to aid least-developed countries.
The WTO hopes a modest agreement can keep Doha on life-support for a later push.
Delegates yesterday called for intensified efforts in Bali to bridge gaps, but no new proposals were made public.
Various estimates say the broader Doha Round could create tens of millions of jobs and perhaps US $ 1 trillion in new economic activity.