WTO Negotiations — Time to Give and Take

Published: The Hindu Business Line, November 18, 2003
By Pradeep S Mehta

International negotiations are a matter of give and take. If one has to become advantageous in six things, one will need to give in on at least two things.

THE Commerce Minister, Mr Arun Jaitley, has arrived as a skilled and thoughtful communicator. Late October at a seminar that featured a post-Cancun analysis speech by him, Mr Jaitley exhorted the country that future trade negotiations are going to be tough and one will have to be ready to make some concessions. Breaking all traditions, some weeks ago, he also wrote a long article in the press on what happened at Cancun and what lies ahead.

It is rarely that a Minister dealing with international trade is so clear and open. Overall, the public discourse will help create a better understanding in India and elsewhere. Also, the controversy surrounding international trade and globalisation will benefit from more transparency.

It is not only the WTO but also the recent offensive by India to enter into bilaterals and regional free trade agreements that came in for debate at the seminar.

This is where the media have to be better informed rather than highlight some stray protest, cautioned Mr Jaitley. This then becomes a sort of mantra of a particular trade deal as being bad. The much older Indo-Sri Lanka FTA had come under attack by the tea, spices and garments lobbies, but it has not affected India’s industry.

What is worth noting is that except a few newspapers, none reported this crucial aspect of Mr Jaitley’s speech. What most newspapers carried was India’s rejection of the September 13 Draft Ministerial Declaration as a basis of taking forward the negotiations at Geneva. In fact, it was this draft which had caused the most heartburn and, thus, turned away countries from reaching any deal. The draft did not capture the feelings of members on both agriculture and Singapore issues, while belittling the issue of cotton subsidies (“eat cakes, if they cannot get bread!”). The last clearly hurt not only the small West African countries, but also the whole continent.

The South African Trade Minister, Mr Alec Erwin, writing in the Financial Times (September 29) criticised the process adopted by the Mexican chair saying that, “On the afternoon of day four (September 13) of the five-day ministerial meeting, the Chairman released the second draft agreement. Developing countries criticised it, sometimes passionately, as an unacceptable basis for negotiations. This was not a political or polemical stance; the balance of the draft was wrong… On cotton, the draft called on West African farmers — whose livelihoods are being destroyed by the effect of the US and the EU subsidies — to consider other economic options, but did not commit the US or the EU to remove subsidies themselves. African countries were appalled”.

Mr Jaitley, writing in the Financial Express (October 9) buttressed the issue: “A high degree of distortion prevails in the agricultural sector, with heavy subsidies being given in certain developed countries to their farmers. This not only limits access into markets in these countries, but also prevents fair competition in third country markets. In countries like India, with a huge rural population, entirely dependent on agriculture and a large proportion of them below or close to the poverty line, a small disruption in the market could bring down prices sharply, leading to fall in incomes and to actual starvation and widespread misery.”

Development was the buzzword at Doha, and that seems to have been lost somewhere. Cancun reminded us of this, as noted by many ministers and observers. “With a political substance without precedent, a group of countries with a remarkable negotiating capacity and a solid technical preparation has arrived and shown the need to focus on “development” of the great majority of the WTO members. This event is systemic and from now on will have an impact on the negotiating dynamics of the organisation,” wrote the Argentinean Foreign Affairs Minister, Mr Rafael Biesla, in El Paes (October 14), one of Spain’s leading newspapers. “Cancun has made a change in the balance of the powers within the multilateral system evident”.

Another crucial point was made by Mr Jaitley, which did not was reported by the press. He warned that whatever is written needs to be done carefully, because that puts our negotiators under great pressure.

In international negotiations, one really does not know which way the road will turn. Therefore, opinions are often based on experience and perceptions, on which even experts differ.

The most important point made by Mr Jaitley is that international negotiations are a matter of give and take. If one has to become advantageous in six things, one will need to give in at least two things.

That message seems to have got around pretty well, and will, thus, make the lives of Indian negotiators easier — as and when negotiations are re-launched at Geneva. And that is what we want.

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