NEW DELHI/GENEVA/ SYDNEY: A group of World Trade Organisation (WTO) members has informally discussed adopting a global overhaul of customs rules without India if New Delhi goes ahead with threats to block the deal, sources familiar with the talks said yesterday.
India has demanded the deal, which must be approved yesterday, be accompanied by a parallel agreement giving it more freedom to subsidise and stockpile food grains than currently allowed under WTO rules.
The ultimatum revived doubts about the future of the WTO as a negotiating body and many diplomats said New Delhi’s stance could derail the whole process of world trade liberalisation, leading to some nations discussing the last-resort idea of excluding India from the deal.
“If India does end up blocking (on Thursday) there is already a group of members who are interested in pursuing that path,” a source involved in the discussions said. “A dozen or so” of the WTO’s 160 members had informally discussed pushing ahead with the trade facilitation agreement on a plurilateral basis, or with less than 100 percent participation, the source said. The WTO says a successful deal could add $1 trillion to the global economy and create 21 million jobs.
Meanwhile, US Secretary of State John Kerry said yesterday he was hopeful that differences between India and much of the rest of the world over the agreement could be resolved, despite only hours remaining before the deal must be signed.
“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,” Kerry told reporters, after holding talks with Indian leaders as part of an annual strategic dialogue.
India’s new nationalist government has demanded a halt to a globally agreed timetable on new customs rules and said a permanent agreement on food stockpiling and subsidies aimed at supporting the poor must be in place at the same time, well ahead of a 2017 target set last December in Bali.
Kerry, whose visit to India was aimed at revitalising bilateral ties but has been overshadowed by the standoff, said the United States understood India’s position. “We do not dismiss the concerns India has about (the) large number of poor people who require some sort of food assurance.”
But he had earlier warned his hosts that they stood to lose if they refused to budge.
“Right now India has a four-year window where it’s been given a safe harbour where nothing happens,” he told NDTV. “If they don’t sign up and be part of the agreement, they will lose that and then (they will) be out of line or out of the compliance with the WTO.”
Diplomats say India could technically trigger a trade dispute if it caused the deal to collapse, although nobody wanted to threaten legal action at this stage.
As officials in Geneva scrambled to rescue the agreement, India’s Trade Minister Nirmala Sitharaman said New Delhi’s position remained unchanged.
Technical details would still have to be ironed out, but there was a “credible core group” that would be ready to start talking about a deal without India when WTO diplomats return from their summer break, according to the source.
Reuters
