India raises red flag over US moves ahead of restarting Doha talks

Even as the restarting of the failed Doha Talks of the WTO seemed uncertain, India has moved to restate its opposition to “attempts” by United States to bring in agricultural trade liberalization through the backdoor.

On the eve of “informal talks” of trade ministers of the OECD block (most developed countries,) Indian trade minister Anand Sharma has re-iterated his country’s opposition to aggressive and sweeping cuts in import tariffs on agricultural items.

Reduction of tariffs on agricultural products such as beef and food-grain has been the biggest, if not the only, insurmountable difference between India and the United States that led to the failure of the talks two years ago. The talks were started ten years ago to lower trade tariffs across the world and aid in the development of undeveloped countries.

In his latest critique, Sharma said that the big players in the negotiations seem to be losing sight of the ‘development’ angle and seem to think that the negotiations are all about just trade and profits.

“The Doha Development Agenda is one of the most ambitious attempts at ensuring that the issue of development is firmly at the core of the multilateral trading system. The critical interests to be served are those of protecting the food and livelihood security of farmers and vulnerable industries of developing countries,” he said.

The statement indicates that India’s stand — formulated by Sharma’s predecessor Kamal Nath — remains as uncompromising as ever on the controversial subject of agricultural tariffs and subsidies. While the US — the world’s biggest agricultural producer — wants all countries to stop charging high rates of import duties on agricultural items, India is afraid such a move will lead to the ruin of its 500-700 million farming households.

Instead, India wants a fairly large list of ‘exempted items’ and special privileges for least developed countries such as itself, when going in for agricultural tariff reduction. It also wants the US and the European Union (EU) governments to stop paying billions of dollars of subsidy every year for producing food. It is estimated that the US alone provides agricultural subsidies of around $15-20 billion a year, while India’s farmers get almost nothing from their governments.

Sharma accused the US led countries of trying to achieve an equalization or harmonization in agricultural tariffs by making the previously optional ‘sectoral iniatives’ on agriculture into mandatory programs. Sectoral initiatives were designed as small agreements within the larger agreement that allowed like-minded countries to further lessen or even abolish tariffs on items belonging to a particular sector.

Sharma said this move was against the ‘accepted principle’ that tariff cuts cannot be uniform between developed and developing countries.

“It is noteworthy that the developed countries are now seeking to rebalance the perceived “disparity” in the contribution between developed and emerging countries and to achieve, if not equalization, a harmonization of their tariffs. India views such an attempt to shift goal posts as unacceptable and as a violation of the mandate.

“Sectoral Initiatives were always intended to be a non-mandatory top-up to industrial goods liberalization. After the aggressive cuts by developing countries through the Swiss formula, it would be difficult to accept a mandatory top-up,” he said in a statement.

Sharma said he was concerned at the attempt to shift the discussion from development [particularly of countries like India] to purely mercantilist or trade issues, “most of them having scant relevance for developing countries.”

“Developed countries must appreciate our sensitivities, our autonomous liberalisation, the development dimension and the impact on our local industries”, he maintained.

India has found itself almost alone at times among big countries, trying to defend the right to special consideration for least developed countries.

The Indian side also seemed to suspect that all was not well with the recent reports brought out by Director General and others from the World Trade Organization “summing up” the negotiating positions of different countries.

While welcoming the move, India reminded everyone that the summaries are not legal texts and need not be the true representation of various countries’ interests.

“Indian side is clear that reports by the DG and negotiating chairs are by no means revised negotiating texts and so are not meant to change the basis for future negotiations. The texts of December 2008 and the proposals submitted by various members and coalitions remain as the versions under discussion,” it said.

Sharma, meanwhile, added that like most other world leaders, he was keen for the negotiations to restart.