WTO : How we failed to protect our farmers

http://www.tribuneindia.com/news/comment/wto-how-we-failed-to-protect-our-farmers/174469.html

Posted at: Dec 24 2015, PK Vasudeva

The outcome of the ministerial conference of the WTO at Nairobi is a big setback to resource-poor Indian farmers. The negotiating team could neither ensure special safeguard mechanisms nor food security protection. At Bali in 2013, the team had stood firm.

Finally, the 10th Ministerial Conference (MC 10) of the World Trade Organisation (WTO) ended in Nairobi on December 19. There were trade ministers from 162 countries and most of them were disappointed. Many of the trade ministers felt left out of the key negotiations because of the one-upmanship and defiant attitude of developed countries like the United States and the European Union (EU).

Barring the US, the EU, Brazil, China and India, that had closed-door negotiations, the others were left guessing about the outcome of the emerging world trade order. The United States and the European Union were ably assisted by Brazil, a developing country, as they set about forging a new global trade agenda favourable to them. They succeeded in bypassing crucial aspects of the Doha Development Agenda (DDA) for a level playing field for all the member-countries which was launched in 2001, (14 years ago) in Doha, Qatar. 

In the run-up to the Nairobi meeting, a large majority of developing countries led by India, China, South Africa, Indonesia, Ecuador, and Venezuela prepared the ground to ensure that the Doha round of negotiations were not closed by the two trans-Atlantic trade giants. They tabled detailed proposals for a permanent solution for public stockholding programmes for food security and a special safeguard mechanism (SSM) to protect millions of resource-poor, low-income farmers from the import surges from industrialised countries.

The proposal on a permanent solution for public stockholding programmes suggested easy options by expanding the agreement on agriculture to include market price support programmes that can be exempted from aggregate measurement of support (AMS) calculations. The SSM proposal by India, along with the G-33 farm coalition led by Indonesia, set forth a transparent and effective instrument based on price and volume triggers to impose special safeguard duties.

In October, Prime Minister Narendra Modi had told leaders from Africa in New Delhi during India-Africa Forum Summit that the Doha Development Agenda of 2001 could not be closed without achieving these fundamental principles at Nairobi. He said that Africa and India should together ensure a permanent solution to public stockholding for food security and a special safeguard mechanism in place to address unforeseen surge in imports of farm products.

In the run-up to the Nairobi meeting, the two proposals were actively opposed by the US and the EU, which led a sustained campaign to ensure that there was neither an outcome on continuing the Doha Development Agenda negotiations nor a deal on special safeguard mechanisms and public stockholdings for food security. Even while they mounted opposition, the US, the EU, and Brazil along with several farm-exporting countries accelerated their efforts to secure a substantive outcome on export competition at the conference.

India too was expected to settle for a trade-off that involved securing a permanent solution to public stockholding programmes for food security and special safeguard mechanisms, and reaffirmation to continue the Doha Development Agenda negotiations beyond Nairobi. In return, it would commit to a substantive agreement on export competition entailing a phase-out of export subsidies and reducing export credits. Commerce Minister Nirmala Sitharaman did not mince words in making out India's case; neither did she hold back her disappointment at the outcome. She said, “It is regrettable that longstanding issues of interest to a large number of developing countries are being put aside for the future and new issues of recent vintage are being taken up with unusual enthusiasm.” However, what is inexplicable is that the Commerce Minister omitted mentioning India's demand for a permanent solution for public stockholding programmes for food security at a meeting convened by the facilitator, Joshua Setipa, Lesotho's trade minister. She also skipped the meeting convened by the facilitator to discuss SSMs. 

The minister has missed out on an opportunity to make it clear that India would not sign any draft that ignored the agenda it had proposed which happens to be a serious deficiency at the negotiating table. In his draft issued on December 17, the facilitator offered vague language on both the SSM and public stockholding programmes for food security, without proposing any time frame for resolution. Sitharaman duly protested and submitted two proposals, together with China and Turkey, to ensure that there are clear outcomes at the 11th ministerial meeting in 2017. These proposals also mentioned the Doha Development Agenda. 

During her meeting with the US trade representative, Ambassador Michael Froman, in Nairobi, she conveyed categorically that India will need reaffirmation to continue the Doha negotiations until all outstanding issues are resolved. However, Froman declined. As a result, India was unable to forcefully defend the positions it had articulated over the past two years. India apparently yielded ground during the marathon negotiations when there was an exchange of proposals with the US, the EU and Brazil. All the three countries refused to accommodate any language on the special safeguard mechanisms because of the absence of market access negotiations. Eventually, they agreed to remove the Doha Development Agenda and make a reference to the 2005 Hong Kong ministerial declaration. They were unwilling to accommodate India's demand for a definite time frame on the special safeguard mechanisms and public stockholding programmes for food security.

Finally, China joined India in fighting another battle on the post-Nairobi work programme to reaffirming continuing the Doha negotiations. The US and the EU vehemently opposed it and only agreed to insert the term “Doha” instead of DDA negotiations. The US and the EU managed to secure language on new approaches and issues with few caveats. 

It is clear that India failed in its objectives to secure credible outcomes on its demands for SSMs, permanent solutions for public stockholding programmes for food security and the reaffirmation to continue the Doha negotiations. Perhaps, it is the first time that India left a WTO ministerial meeting so disappointed. Civil society groups and trade experts have criticised the government on the outcome of the Nairobi meeting, saying India has got “nothing.” They said that Indian negotiating team was not able to stand firm on their demands related to the special safeguard mechanism, new issues being pushed by developed nations and on public stockholding for food security purposes. 

PK Vasudeva is the author of “World Trade Organisation: The Implications on the Indian Economy”.