Future Negotiations

Suggested course of Future Negotiations at WTO by India I feel the following with regard to future negotiations at WTO:-

1 India should take the lead at the WTO’s Doha Round of negotiations by improving its negotiating stand on special safeguard measures. India is perceived as a “rejectionist” in the US. Both the US and India had dug their heels in at the negotiations — with the US not doing enough in terms of reducing farm subsidies and India sticking to its position on SSM (special safeguard measures) — India can now turn the table on the US by improving its position on SSM. (‘Special safeguard measures’ permit a country to bring in quantitative restrictions on imports when its feels that such imports are surging in a manner that hurts the domestic industry. Some countries feel that India wants a low threshold for imports, above which level it could bring in restrictions. India, on the other hand, believes that it needs to keep the threshold at a level to protect (particularly) farmers from being overly exposed to vagaries of international trade.) 2. Though, going forward in trade liberalisation at a time of macro-economic crisis is very difficult, I still feel that it is wise to “settle for whatever we have”. I feel that it is possible to protect the Indian farmers under other provisions of the WTO. I am confident that there is nothing to be feared by exposing the farmers to competition. I feel that gradual opening up of the agriculture sector to global trade would do no harm. I also understand that doing that would be politically difficult but logic should not be sacrificed on the altar of difficulty. I am sure that farmers’ suicides in recent times were more due to non-agricultural reasons. I will look at it from another angle. If farmers are able to get more competitive prices in open market, then 70% of our population which is dependent on agriculture will be benefitted. 3. On the rise of protectionism in the world, I feel that there are only two kinds of protectionism – one, that is violative of WTO rules (such as the ‘buy American’ provision in the US economic stimulus package) and, two, the exercise of options allowed under the WTO rules, such as bringing in a safeguard duty or raising tariffs from existing levels but still below bound levels. While the first form of protectionism is a “no, no”, there is nothing wrong with the second kind, which is only an exercise of permitted options. However, I feel that India should not be perturbed since, measures such as ‘buy American’ will not work because the well-globalised American companies themselves will provide sufficient counterweight to such measures. Most of the companies have production based outside the US. They export from there into US since US is the major consumer of all world produce. So these companies will themselves strike down the proposal.

Balaji Srinivasan, Roll No: 5, EPGDIB(08-10), Individual Assignment

4. Inspite of the onset of the current economic crisis, there has not been a huge rise in measures such as ‘anti-dumping duties’. Hence, I am confident that the world will be able to contain protectionism. Thus protectionism by developed nations should not unduly worry India. 5. I do not favour India’s stand on climate change negotiations where the country’s basis for argument is its low per capita carbon emission — as, in reality, it is the totality of emissions that matter. That many poor people are very low emitters of carbon is not an excuse for others to pollute. Instead, I feel that it is necessary to treat current emissions and past damage separately. India’s stand that the rich countries such as the US had caused sufficient damage to climate in the past — during their own developmental stages — and hence India should be similarly allowed until it catches up in terms of development will never be accepted by the world at large. Hence, India should bat for measures for curbing current emissions — such as with caps on emissions — to be uniformly applied across all countries and should ask for penalizing the rich countries by suggesting that they pay for repairing the damage they had done in the past. Some sort of climate fund — that should be outside the World Bank may be constituted to which the developed countries would pay a certain % of their GDP, which would be used to promote and subsidise purchase of low- carbon technologies by developing countries and also for greening the of the world. The fund shall have to be necessarily managed by the developing and under-developed economies with no interference from the developed nations.

Balaji Srinivasan, Roll No: 5, EPGDIB(08-10), Individual Assignment