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WTO in crisis as India catapulted food safety issue

 

Posted on 26 Jul 2014

Last updated 06 Jul 2016

  India, Modi, Food Security, WTO, TFA
The opposition to the standalone trade facilitation deal, which has been strongly pushed by industrialised members of WTO, by India and several other developing countries including South Africa has raised questions over the objective of WTO and the commitment of developed countries towards the wellbeing and development of the poor against their market expansionist strategies for fulfilment of trade interests.
Basudev Mahapatra
 

India’s stand in regard to the trade facilitation deal in the WTO meeting at Geneva has become another shocker to the United States and other developed nations while strengthening India’s position as representative of the developing nations or the third world.

Demanding serious attention of the developed world towards the issue of food security, which affects 600 million poor people of the world, and appealing the World Trade Organisation (WTO) general council to derive a permanent solution to it before ratifying Trade Facilitation Agreement (TFA), the Narendra Modi government of India sought the ratification date be shifted to 31 December instead of July 31.

Developing countries like India and South Africa wanted that the issues related to food security and subsidy be discussed before pushing for the TFA as they are important issues concerning millions of poor people living across the globe.

"India is of the view that the Trade Facilitation Agreement must be implemented only as part of a single undertaking including the permanent solution on food security," said Anjali Prasad, the Indian Ambassador, at the WTO meeting.

The stand of India has disappointed most of the developed countries including the United States who press on quick ratification of TFA that, as estimated by many, would add $1 trillion to global GDP and can also generate 21 million jobs by slashing red tape and streamlining customs.

"We are extremely discouraged that a small handful of members in this Organisation are ready to walk away from their commitments at Bali, to kill the Bali agreement, to kill the power of that good faith and goodwill we all shared, to flip the lights in this building back to dark," Deputy US Trade Representative Michael Punke said in his.

While Michael Punke’s mention of “small and handful members” is seen as an attempt to undermine the interests of a significant population of poor, Indian’s Commerce and Industry Minister Nirmala Sitharaman countered Punke’s statement saying, “Bali is a package, you can’t have standalone deals on it,” as quoted by the Hindu Businessline.

In its statement, India said that a single undertaking and permanent solution was important so that millions of farmers and the poor families who depend on domestic food stocks do not have to live in constant fear.

“To jeopardise the food security of millions at the altar of a mere anomaly in the rules is unacceptable,” said the statement where India placed its stand very clearly.

While appealing the WTO council to convene special sessions to work out a permanent solution, India wanted its subsidies for food procurement to be excluded from the category of trade distorting subsidies. It also demanded that the current year be fixed as the base year for calculating food subsidies instead of 1986.

“All we are asking is that the public stockholding issue should be taken forward in the same timeframe as trade facilitation,” said the statement adding that “We will not only be able to find a permanent solution on the issue of public stockholding for food security but will also be able to implement trade facilitation agreement in the agreed timeframe as well,” provided all WTO members demonstrate same energy and commitment on the other Bali issues.

Instead, “to make matters worse, persistent efforts are being made to subvert the mandate by divesting it of its core elements,” India said in its statement deceptively referring to US and other industrialised nations.

Seeing the voice of India as a road block for the trade pact, Punke said, "It is profoundly disappointing that we have arrived at this moment.”

“I do want to speak very directly about the issue of public stockholding for food security, because it has been a focal point of attention," he added.

“We have not blocked the deal. If that is the interpretation, God only knows how many times WTO has been blocked. Nobody said that WTO was blocked in 2006, 2005, 2008, 2009, 2013 when talks were derailed due to tough posturing by industrialised nations,” said K R Sudhaman of Financial Chronicle quoting a commerce ministry official who also said, “Food security is not an esoteric issue, it is a relevant and real issue."

While members, including developing countries such as Nigeria, Pakistan and Thailand, backed the trade facilitation deal, India's opposition attracted support from Cuba, Venezuela and Bolivia, who expressed their disappointment saying that only the rich countries had got what they wanted from the Bali conference.

Terming India’s hard stand as “backsliding” that has brought WTO to the “brink of crisis,” US Trade Representative Michael Froman said in a statement that “The United States would consult with other WTO members on appropriate next steps.”

The opposition to the standalone trade facilitation deal, which has been strongly pushed by industrialised members of WTO, by India and several other developing countries including South Africa has raised questions over the objective of WTO and the commitment of developed countries towards the wellbeing and development of the poor against their market expansionist strategies for fulfilment of trade interests.

The primary question is – Should the interests of millions of poor be sacrificed to open the market for leading manufacturers that comes with a mask of development? And, the bigger question is – Aren’t the developed countries demonstrating their irresponsibility by neglecting the cause of food safety of millions of poor just to expand their market and promote free trade?

As the US Secretary of State John Kerry is scheduled to visit India on July 30, he may have to face these questions from several forums.

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