Tuesday, Sep 23, 2014

India offers new proposal on WTO cliffhanger deal

ENS Economic Bureau | New Delhi | Posted: August 1, 2014 1:02 am

Amid hectic parleys in Geneva to clinch the elusive WTO trade facilitation agreement (TFA), the deadline for which was set to expire on July 31, India is learnt to have offered a new proposal “within the contours of the original one” clinched at Bali, as a last ditch effort to break the impasse. This was even as the US expressed hope for a compromise to end India’s opposition to signing up for the TFA.

However, till the time of going to press, the WTO General Council, which was meeting in Geneva, had not arrived at a decision.

Earlier on Thursday, US secretary of state John Kerry, after meeting external affairs minister Sushma Swaraj and finance minister Arun Jaitley, told reporters, “We are obviously encouraging our friends in India to try to find a path here where there is a compromise that meets both needs, and we think that’s achievable. We hope that it’s achievable… We do not dismiss the concerns India has about (the) large number of poor people who require some sort of food assurance”.

Even as indications of a thaw in India’s stand came in, officials in New Delhi continued to highlight their concerns on the food security issue, a stand reiterated by commerce and industry minister Nirmala Sitharaman who, during the course of her meeting with the visiting US commerce secretary Penny Pritzker, said that India’s concerns remain.

India has been maintaining that the TFA must be implemented “only as part of a single undertaking including the permanent solution on food security.” However, its stand has met with stiff opposition from developed countries which have joined hands against New Delhi, asking it to not veto the TFA of the WTO.

In the general council meeting last week, India had proposed establishing an institutional mechanism including a dedicated special session of the committee on agriculture to find a permanent solution on public stockholding for food security by December 31, 2014. It had proposed a review of the progress of the discussions in October by the council.

For adoption of the TFA, which aims at simplifying customs procedure and promote global trade, the consent of all 160-WTO members is needed.

New Delhi is pressing for an amendment to WTO norms regarding stockpile of food grains, an issue critical to India’s food security programme. The current WTO norms limit the value of food subsidies at 10 per cent of the total value of food grain production.

However, the support is calculated at the prices that are over two-decade old.

India is asking for a change in the base year (1986-88) for calculating the food subsidies. India wants a change taking into account inflation and currency fluctuations.

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