India : CUTS hails the revival of Doha trade talks

January 31, 2007
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“Global welfare worth billions of dollars is at stake and trade ministers from around the world have taken a right decision to revive the Doha round of trade talks at the political level,” said Pradeep S. Mehta, Secretary General of CUTS International while welcoming the decision.

Trade ministers from about 30 countries from Asia, Europe and Americas met on the sidelines of the World Economic Forum held at Davos in Switzerland and decided to revive the stalled negotiations.

“Suspension of Doha Talks and Cost Implications for India”, a study done by Consumer Unity & Trust Society (CUTS) shows that developing countries like India would incur huge economic loss if the Doha round is not completed soon. The political loss would be much greater than the economic loss.

These countries are much more vulnerable while opening up their trade regime through the bilateral route rather than subjected to a more rules-based and disciplined multilateral regime. There could be due to increased protectionism; increase in trade disputes and so on.

Another study by CUTS on “Concluding the Doha Round” argues: “If the deal could be clinched with the US agreeing to freeze its domestic support at US$15bn, then, it is a matter of US$4bn (from what US is insisting as a cap in its domestic subsidies) only and that too which benefits mostly big agri-businesses of the US. Now, the big question is, should global welfare of billions of dollars, which is likely to result from successful conclusion of Doha round be mortgaged to the US resistance to reduce domestic subsidies by another US$4bn?”.

However, Mehta cited a study done by the International Food Policy Research Institute last year and argued that as things stand now, low-income countries would merely receive about two percent of this increase in global welfare and it would be the rich countries who are to gain most.

Agreeing with the findings of this study, Mehta emphasised that if the rich countries provide 100 percent duty-free, quota-free access to products originating from poor countries then there will be further increase in global welfare and almost half of that increase would accrue to the poor.

“Not only that poor producers of low-income countries would gain, there will be a huge gain for relatively poor consumers in rich ountries, as protectionism in the rich world is more prominent in products mostly used by them.
 

Not many jobs are saved either on account of such protectionism”. Since last November, Doha trade talks have shown signs of revival, as trade negotiators worked hard in Geneva and national capitals to take technical discussions forward.

“Now is the time to conclude these negotiations at a political level and deliver of developmental promises of Doha, as that would be win-win for producers and consumers alike,” Mehta added.

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Developed world’s agriculture sop offer key to Doha revival

January 15, 2007, Financial Express
India

New Delhi, Jan 14 With the deadlock in WTO talks continuing, any positive indication by major trading partners is seen as a flicker of hope for breaking the impasse.

The meeting between EU trade commissioner Peter Mandelson and US trade representative Susan Schwab in Washington last week did generate some hope. The meeting was followed by a joint statement by Mandelson and Japanese Prime Minister Akira Amari calling for an early resumption of stalled talks. Mandelson flew to Paris last Thursday to brief French Prime Minister Dominique de Villipin and his Cabinet colleagues about discussions he had with Schwab and Amari. Schwab flew to Geneva to discuss with WTO director-general Pascal Lamy on last Friday. The these major negotiators, however, did not yield any significant result.

“India is closely watching the developments,” a senior official in the commerce ministry said adding “we are waiting for developed countries committing to make substantial cuts in their farm subsidies”.

According to some experts, these recent developments may prompt Lamy to take India’s help for breaking the deadlock when he visits the country this week for a CII partnership summit in Bangalore. Other experts expect some developments on the sidelines of the World Economic Forum in Davos. Moreover, there is likely to be a meeting in New Delhi in March which will be attended by several ministers from key nations.

Mandelson after meeting the French Prime Minister assured that EU would not take any unilateral decision. France is a strong defender of European farm interests and, with polls ahead in that country, it seems unlikely that the EU would be able to offer any substantial cuts in its farm subsidy.

Also, public gestures of the USTR, Susan Schwab has invited opposition from Democrats who are now in a majority in the Congress.

While all these developments are taking place, a Washington-based think tank, Carnegie Endowment for International Peace said that “a mutually beneficial solution to the problem is still not in sight.” Delhi-based CUTS-International is also of the view that talks can proceeds if the US offers to cut its farm subsidies.

In a study entitled B’reaking the Doha Deadlock : Congress Could Play a Pivotal Role’ the Carnegie Endowment said it was counterproductive for the US to insist on terms that could lower the income of poor farmers in developing countries, by displacing their production or causing prices to drop for the commodities they produce. The US should not insist developing countries to reduce their tariff. It should accept G-33 proposal on special products, with additional clarifications to ensure that flexibility is used to achieve agrarian development and poverty alleviation in the developing world.

The study also said the US could benefit through exports only if farm income levels continues to rise in the developing countries.

Carnegie Endowment study severely criticised the inequitable, distorted and very expensive set of US policies, serving the interests of the few against the majority in the country and urged the Congress for a sober revision of the US policy in the Farm Bill, 2007.

The EU has indicated that it is prepared to give market access to the developing world by effecting an average tariff cut by 50%. A revision in the US proposal in the farm sector would enable it to make new agreements at WTO that can open up its opportunities for its manufacturing and services sector, the study said.

URL: http://www.financialexpress.com/fe_full_story.php?content_id=151734

CUTS Intl to open office in Vietnam

January 04, 2007, Business Line
India

CUTS International, a Jaipur-based research and advocacy non-profit organisation, is opening its fourth overseas centre in Hanoi, Vietnam this month.

Among its other overseas centres, the first one was established in Lusaka in Zambia in 2000, followed by Nairobi, Kenya in 2002 and London, UK in 2003. The purpose of these offices is to promote trilateral development cooperation on a range of trade and economic policy issues. These offices also network with many NGO's in the region other than Government agencies.

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