People's Democracy

Response Of The Left Parties To The 

Govt’s Note On WTO Negotiations

Condensed from the original note sent to the government 

INTRODUCTION

THE detailed note on WTO Negotiations provided by the government does not reflect any significant departure from the positions adopted by the previous government. Given the structural inequality and asymmetry that is built in the WTO agreement, which favours the developed countries, India’s long-term interests are best served by making common cause with the developing countries. The formation of the G 20 and the G 33 at the time of the Ministerial in Cancun in 2003 was a positive step in that direction. Subsequent events, especially India’s becoming a part of the “Five Interested Parties” and its role in bringing about the “July Framework Agreement” in 2004, and lately, India’s co-chairing the Services group with USA and maintaining silence on the attempts by developed countries to front-load the negotiating outcome against the developing countries, have raised questions regarding our commitment to the unity of the developing countries. In this context, the formulation contained in the government’s note: “wherever there are common interests on specific issues, India has worked closely with developed countries also”, causes concern. The solidarity of the South, and not expedient “issue-based” coalitions with USA/EU, must be the bed-rock of our strategy in WTO.  Some of the concerns on India’s negotiating position on the issues of Agriculture, NAMA, GATS and TRIPS and some suggestions are elaborated below.

AGREEMENT ON AGRICULTURE

1. There is a need to examine the outcome of the AoA as compared with the promise that was held out in terms of benefits to developing countries, before finalising the next phase of liberalisation.

2. All export subsidies, including export credit, export credit guarantee and export insurance by the developed countries should be eliminated immediately. Dropping the Blue Box (domestic support listed in Article 6.5 of the AoA) in any form as was originally visualised in the AoA, but was reversed in the July framework, needs to be re-emphasised. Further, it needs to be pointed out that most Green Box measures (domestic support listed in paragraphs 5 to 13 of Annex II to the AoA) are indeed trade distorting and thereby demand a reduction in the total producer support provided to agriculture in the US and the EU in return for any concession that developing countries may offer. Apart from notifying the Green Box subsidies within a month of the new negotiations, there should be reduction/elimination of these subsidies in a time-bound fashion.

3. Considering the vital role that agriculture plays in providing livelihood to the large majority of the work force in developing countries, taking into account the nature of small-scale, largely rain-fed, small-and marginal-peasant-dominated nature of their agrarian economies, recalling the notorious volatility of world agricultural prices, (particularly the severe downturn in the recent years after the coming into being of AoA) and the continuing heavy subsidisation of agricultural production and trade by developed countries, the right of developing countries to impose QRs to safeguard the livelihood of three billion strong peasantry needs to be enshrined as an integral part of AoA on the lines of Article XVIII B of GATT.

4. The developing countries should be entitled to provide subsidies (outside the scope of reduction commitments) for domestic production of food products for domestic consumption in order to ensure food security. The developing countries may also be entitled to provide subsidies (outside the scope of reduction commitments) to farmers for the purpose of protecting their livelihood.

5. The developing countries that have been denied the facility of the special safeguard in agriculture until now should have access to it. Developing countries should be allowed to use the "Special Safeguard Mechanism" in respect of all agricultural commodities.

6. A developing country may take SSM for protection against price falls. This cannot be dependent on an import surge as suggested in the July Framework, as domestic price falls are not necessarily triggered by import surges, but, more often than not, are induced by the fall of prices of commodities in the international market. For a price slide, it may be stipulated that a developing country may take SSM if the price of the product falls below a certain percentage of the previous years' average price.

7. There should be expansion of TRQs maintained by developed countries beyond the levels earmarked for specific countries, and it should be available to all countries without discrimination. Various Non-Tariff Barriers imposed by the developed countries also need to be eliminated.

8. Under S&D provisions, the developing countries may provide export subsidy, specially for adoption of higher technology and adaptation to product and process standards as well as to compensate for various handicaps for e.g. in financing, guarantees and insurance, in respect of production and export.

NON-AGRICULTURAL MARKET ACCESS (NAMA)

1. The Non-linear formula of tariff cuts that India has agreed to should be reconsidered.

2. Instead of line-by-line tariff cuts (that is tariff cuts on each product), the Uruguay Round approach of average cuts, together with minimum cuts per tariff line should form the basis of our negotiating position.

3. The problem of tariff peak (i.e. products where there are very hugh tariff rates) can be solved by negotiating that the highest tariff rate leviable by any country can be specified as a fixed mark up over the newly calculated tariff average, the mark up being negotiable for each country. Another method to deal with tariff peaks is by introducing suitable tariff caps, with developing countries capping their tariffs by a factor ‘x’ higher than that for the developed countries.

4.   India should reiterate its earlier position of not binding unbound lines. The position against harmonisation must be steadfastly adhered to.

5. The issue of Non-Tariff Barriers (NTBs) – the primary mode of preventing market access that is used by developed countries -- should be addressed concurrently with that of tariff reduction. There should be no agreement on tariff cuts without any agreement on how NTBs are to be reined in.

6. SSIs should be given special consideration before formulating positions on tariff reductions.

7. There should not be any sectoral tariff elimination commitment.

8. India must oppose attempts to convert livelihood issues into trade issues, for e.g. the inclusion of the fishing sector under NAMA.

GENERAL AGREEMENT ON TRADE IN SERVICES (GATS)

1. India must resolutely oppose the moves of developed countries to introduce new concepts such as  “benchmarking-” “baseline-” or “complementary approaches” into the GATS seeking to destroy the built- in Special and Differential Treatment in favour of developing countries. As other developing countries are opposed to these moves, our task of pre-empting this attempted sabotage of GATS should not prove difficult.

2. Withdraw the offers submitted with respect to the commitments for market access for basic services like water, health and education.

3. Revise the offer list in view of the response of the US and EU. Movement on the offer process should be preceded by extensive domestic consultation with the stakeholders of every sub-sector which is being included in the offer.

4. Review upwards the FDI cap of 51 per cent specified in the offer list. Sensitive sectors which presently have FDI caps below 51 per cent in India should be taken out of the offer list.

5. No dilution of defensive position on Agriculture or NAMA in order to get concessions on ‘offensive interests’ in Mode 1 and Mode 4 liberalisation.

TRADE RELATED INTELLECTUAL PROPERTY RIGHTS (TRIPS)

1. Expedite negotiations on Protection of Geographical Indicators in the WTO, in order to extend it to agriculture, natural goods, manufactured goods or any goods of handicraft or goods of industry or food stuff on the lines elaborated earlier.

2. In the ongoing review of the Patentability of micro-organisms and non-biological and micro-biological processes, India should argue for the exclusion of these subject matter from patentability.

3. India should press for a review of TRIPS in the broader context of reviewing its impact and pressing for changes in the Agreement itself on the lines elaborated in the Annexure.

4. The issues of access to biological resources, prior informed consent and benefit sharing should be pursued in the WTO in line with the Convention on Biodeversity (CBD).

5. India should propose mechanisms to promote public domain science. Specifically, General Public License in software & bio-technology needs to be argued for on the basis of the principle that all inventions and software that make use of knowledge in the public domain under open licenses cannot be copyrighted or patented and the laws of all countries should reflect this protection.

6.  The patent law of each country should provide for technology transfer promptly without further negotiations.

CONCLUSION

The negotiating positions adopted by the government in the Hong Kong Ministerial in December 2005 and the outcome of these negotiations will have far- reaching and even irreversible, adverse consequences for the country’s economy and polity, particularly for the peasantry and working classes. The Uruguay Round commitments were made in a non-transparent manner. The fait accompli was sought to be justified in the initial years in terms of highly exaggerated estimates of “gains” computed by biased “experts”. Now it is an acknowledged fact that developing countries were short-changed in that round and it turned out to be a severely adverse bargain. We should learn from that bitter experience. It is thus imperative that the positions that the government proposes to pursue at the Hong Kong Ministerial are set out in a White Paper and discussed in the Parliament during the Winter session. It is important that an informed debate takes place on the floor of parliament and no commitment is taken without a national consensus to back it.