India Eclipsed at WTO Ministerial

Minister Sitharaman Fights a Fruitless Battle

Only five countries – the US, European Union (EU), Brazil, China and India, who negotiated among themselves in “Green Room” format the final outcome based on their respective national interests – the others were left out. Commerce Minister Nirmala Sitharaman led the Indian attack. The ministerial had to be extended by another day to accommodate India who was isolated at the end of day with the 53 nation Africa group led by Amina Mohamed deserting the ranks to join the chorus seeking an end to all agriculture subsidies.

Nirmala Sitharaman at Nairobi MC10 with WTS Reporters

India now has to end agri export subsidies by 2018. It can hope to get some cover for transport and marketing expenses for another four years. There is also no progress on Indian demand for food procurement at minimum support prices for public stock holding. The quid pro quo for signing trade facilitation deal is not working. It has got only special negotiating sessions for this demand. It has got the same result of special negotiation session for its other demand for special safeguards to protect its agriculture for sudden drop in import prices or rise in quantity.

The Doha Development Agenda (DDA) was launched in Doha, Qatar, in 2001. The US and the EU had supported the Round immediately after the 9/11 terrorist attacks in the US, as a way to unite the world New issues of Singapore 1996 ministerial like Investment and Competition Policy along with trade facilitation were part of this Round.

The India proposal on a permanent solution for public stockholding programmes suggested easy options by expanding the agreement on agriculture to include market price support programmes that can be exempted from aggregate measurement of support calculations. The SSM proposal by India, along with the G-33 farm coalition led by Indonesia, set forth a transparent and effective instrument based on price and volume triggers to impose special safeguard duties.

The US led a sustained campaign to ensure that there was neither an outcome on continuing DDA negotiations nor a deal on SSM and public stockholdings for food security.

India wanted a permanent solution to public stockholding programmes for food security and SSM, and reaffirmation to continue the DDA negotiations beyond Nairobi. In return, it would commit to a substantive agreement on export competition entailing a phase-out of export subsidies and reducing export credits.

Sitharaman did not mince her words in making out India’s case; neither did she hold back her disappointment at the way things turned out. “It is regrettable that longstanding issues of interest to a large number of developing countries are being put aside for the future and new issues of recent vintage are being taken up with unusual enthusiasm,” she said.

In his draft issued on 17 December, the facilitator offered vague language on both the SSM and public stockholding programmes for food security without proposing any time-frame for their resolution. Sitharaman duly protested and submitted two proposals together with China and Turkey to ensure that there are clear outcomes at the 11th ministerial meeting in 2017. These proposals also mentioned the DDA negotiations in passing.

Nirmala met the US trade representative, Ambassador Michael Froman, in Nairobi, that India will need reaffirmation to continue the DDA negotiations until all outstanding issues are resolved. Of course, Froman declined.

India expressed deep disappointment over NMD saying its concerns were not addressed adequately. More importantly, the NMD which was finalized after five days of hectic negotiations failed to incorporate New Delhi’s core demand for reaffirming the continuation of Doha Development Agenda trade negotiations.

At the final plenary meeting, India’s trade minister Nirmala Sitharaman made a pitch for “Doha Only” but the final draft accepted the US demand for new issues by saying “some wish to identify and discuss other issues for negotiation; others do not.” India had all along opposed discussing new issues.

The NMD on agriculture contained decisions for an accelerated work program on special safeguard mechanism (SSM) and the public stockholding programs for food security.

The draft NMD and the Nairobi deliverables on agriculture was adopted at meeting at the Kenyatta International Conference Center.

China joined India in fighting another battle on the post-Nairobi work programme for reaffirming to continue the DDA negotiations. The US and the EU vehemently opposed it and only agreed to insert the term “Doha” instead of DDA negotiations. The US and the EU managed to secure language on new approaches and new issues with a caveat that new issues cannot be accommodated unless all members agree, this was the saving grace for India.