Nairobi WTO meeting to test India’s resolve on agriculture

13 October, 2015

By D Ravikanth

India unlikely to secure credible gains for its millions of poor farmers unless the govt stands firm against the US over its opposition to New Delhi’s demands in agriculture.

Geneva: India is unlikely to secure credible gains for its millions of poor farmers as part of the proposed outcomes of the World Trade Organization (WTO)’s Nairobi ministerial meeting unless the Narendra Modi government stands firm against the US over its opposition to New Delhi’s demands in agriculture.

“The Nairobi meeting is a litmus test for the Indian government—whether it stands up for its poor farmers or succumbs to pressure from the United States, which continues to oppose credible and developmental outcomes,” said an African trade official, who asked not to be named.

At closed-door meetings in Istanbul on the margins of the G-20 trade ministers’ summit on 5 October, commerce minister Nirmala Sitharaman made a strong pitch for credible and balanced outcomes at the Nairobi meeting. She demanded outcomes on a special safeguard mechanism and a permanent solution for public stockholding programmes for food security, according to people familiar with the meeting who declined to be named.

But India’s demands fell on deaf ears as, two days after the Istanbul meetings, the US ruled out any outcome on the mechanism. On Thursday, US trade envoy Michael Punke, who took part in the meetings attended by Sitharaman, said there is “zero evidence of convergence” on the safeguard mechanism, which enables developing nations to impose duties on imported agriculture products based on price and volume triggers.

Speaking at the general council meeting, Punke said that merely restating demands on issues such as the safeguard mechanism will not help. The US and its supporters also continue to oppose the permanent solution to public stockholding programmes for food security on the grounds that India and other members of the G-33 failed to table a fresh proposal, according to trade envoys familiar with the meeting, who spoke on condition of anonymity.

Effectively, the US along with other industrialized nations, and even some developing countries such as Pakistan, have ensured there is no outcome on the safeguard mechanism by adopting diversionary tactics time and again, according to several trade envoys from developing nations.

At the general council meeting, divisions over a package of outcomes for the Nairobi meeting, with the US and other industrialized countries on one side and India along with most of the developing and poorest countries on the other, came out into the open.

The US and its supporters want a finite number of deliverables in which they do not have to undertake any fresh commitments. The finite number of outcomes that the US and other industrialized nations are comfortable with include “export competition (in agriculture)”, some limited concessions for the poorest countries and transparency-related commitments.

So far, the proponents of this finite number of deliverables have not tabled any proposal. But WTO head Roberto Azevêdo repeatedly proposed a small package of issues “where there appeared to be more convergence and which might be potential deliverables for MC10 (tenth ministerial conference)”.

In sharp contrast, India, China and Indonesia on behalf of 47 developing countries, Lesotho, which coordinates the African countries, and Barbados, which speaks for the large coalition of African, Caribbean and Pacific nations, demanded comprehensive and balanced outcomes, particularly deliverables that would help resource-poor farmers in the South.

“India has consistently held that a comprehensive and balanced outcome in all the three core negotiating areas, viz., agriculture, non-agricultural market access and services, as well as internally on all three pillars of agriculture, even if with a downward recalibration of ambition, is a necessary condition for fulfilling the development mandate of this round,” India’s trade envoy Anjali Prasad said at the council meeting. “We believe that we should continue our efforts to reach as close as possible to that result at Nairobi.”

Chinese trade envoy Yu Jianhua also demanded “credible and balanced developmental outcomes” at the Nairobi meeting.Brazil’s trade envoy Marcos Galvao said developing nations remain frustrated because of the continued failure to address the trade-distorting domestic support in agriculture. Galvao said all promises to reform agriculture subsidies and market access barriers are “broken”.

Besides the substantive differences on the package of deliverables, the US and the European Union (EU) also declared unambiguously that they want to bring an end to the Doha Round at the Nairobi meeting because of its failure to bring about convergence over the past 14 years.

The EU wants to launch new negotiations while pursuing unresolved issues in agriculture and other areas outside the Doha architecture. But a majority of WTO members want to continue with the Doha negotiations regardless of the outcomes at Nairobi. “India believes that multilateral negotiations such as those envisaged under the DDA (Doha Development Agenda) are an ongoing process, especially when they are aimed at addressing existing inequities in the trading system,” Prasad maintained.

“The framework provided by the DDA is a valuable component for attaining this goal, and should continue to anchor the deliberations on remaining DDA issues,” India emphasized.

But on Monday, in what seems to be an attempt to dilute calls for reaffirming the continuation of DDA negotiations as demanded by India and others, Azevêdo appointed three facilitators to discuss elements that will go in the post-Nairobi ministerial declaration, said a trade envoy close to the development.