India, Cuba come Together on WTO E-Commerce Rules on Buenos Agenda

India has joined forces with Cuba to resist pressure from other members at the World Trade Organization to start negotiations on e-commerce rules.

Australia, the EU, Norway and China have stepped up their campaign to include e-commerce in the agenda for the year-end Ministerial meeting in Buenos Aires, and New Delhi is reaching out to countries that share its opposition to the move.

At a recent meeting of the WTO’s goods council, India and Cuba took the stand that it was premature to discuss multilateral rule-making in e-commerce, given the digital divide among members.

Several other members such as Australia, Switzerland, Norway, Brazil and Argentina, however, said that an agreement on e-commerce was necessary for the WTO to demonstrate its continued relevance.

Enormous pressure

Cuba particularly took issue with suggestions to negotiate liberalisation and market access in e-commerce and emphasised that there was no basis for doing so, he added.

Electronic commerce was made a part of the WTO in 1998, but in a limited way. Members had agreed to give a temporary moratorium on import duties on digital transmissions. This moratorium is extended every two years. It was also decided to hold discussions on various aspects of e-commerce, but there was no understanding on negotiating rules.

The stakes in India

The e-commerce sector is extremely sensitive in India as the move to allow foreign investment into the e-retail sector has, so far, been strongly resisted by the owners of small stores who argue that it will disrupt their livelihoods. Allowing multilateral rule-making in the area could lead to political destabilisation.

The African countries and the least developed countries (LDCs) have not opposed discussions on e-commerce, but they insist that the focus be on the development dimension.

Uganda, on behalf of the LDC Group, said that most of the proposals on the table fall outside the scope of the work program on e-commerce, and that development should be the focus of e-commerce talks. South Africa, speaking on behalf of the African Group, similarly said it would like the Goods Council to take up issues that place the needs of developing countries and LDCs at its core.