India, US break WTO deadlock
and the US have agreed to bury their differences over farm subsidies, which might break the logjam at the World Trade Organization (WTO) and pave the way for future implementation of the Trade Facilitation Agreement (TFA) to ease global customs norms.
The impasse had persisted since July when India stuck to its stance over having a parallel agreement on public stockholding for food security for its poor and marginal farmers, vetoing the much-awaited TFA Stock Market Trading Tips
The differences were resolved after the US agreed to accommodate India's concerns over food security during the upcoming general council (GC) meeting, the organisation's highest decision-making body, on December 10-11. "We are happy that India and the US have successfully resolved their differences related to the issue of public stockholding for food security purposes in the WTO in a manner that addresses our concerns," minister of state (independent charge) for commerce and industry Nirmala Sitharaman said here on Thursday Nifty Trading Tips
Apparently, the actual deal reached between the two early this month was that during the next GC meeting to be held at the WTO headquarters in Geneva, the US would support India's stand of having the so-called 'peace clause' agreed upon along with adopting the protocol of amendment of the TFA, officials in the commerce department involved in the talks told Business Standard. In other words, the US has agreed to support India's stand for having the 'peace clause' in perpetuity, which will make India immune to WTO complaints, until a permanent solution is sought. A permanent solution to the food stockholding issue entails amending the WTO's Agreement on Agriculture (AoA), talks for which will be expedited.
Therefore, neither the TFA nor the agreement on food stockpiling will be signed in December.
The GC in December is expected to only make a statement of intent that all members agree to have the 'peace clause' until a permanent solution on food security is reached Intraday Trading Tips
In Washington, US Trade Representative (USTR) Michael Froman said that the Bali package, which was held up in July after India raised concerns over the food security issue, would move forward. "We have overcome that delay and now have agreement with India to move forward with full implementation (of the Bali package)," he said. It is learnt that the US has also agreed to start negotiations for reaching a permanent solution on food stockpiling by creating an institutional framework that will lay the road map for the talks, which was one of the main demands made by India since the Bali ministerial took place in December last year. "This will end the impasse at the WTO and also open the way for implementation of the TFA... After the Prime Minister's visit to the US, there was greater understanding of India's position," Sitharaman said. Lauding the efforts put in by India and US trade negotiators, WTO Director General Roberto Azevêdo said it was a "significant step in efforts to get the Bali package and the multilateral trading system back on track Commodity Trading Tips
"It will now be important to consult all WTO members so that we can collectively resolve the current impasse as quickly as possible," Azevêdo said.
The European Union said it would look for the "next steps" on implementing all tenets of the Bali package, including "immediate adoption" of the trade facilitation protocol. "Implementation of the TFA will allow the WTO to resume work on other key aspects of the Bali deal, including advancing on the preparation of a work programme for the Doha Development Agenda (DDA), thereby setting us on a path towards the conclusion of the Doha round," said EU Trade Commissioner Cecilia Malmström. During the G20 Summit in Brisbane, leaders are also expected to explicitly state the movement expected on the WTO Bali talks. India, under the former UPA regime, was successful in achieving the 'peace clause' after a bitterly fought round of negotiations with the US. However, at that time it was decided that the clause would be applicable for four years until the 2017 ministerial meeting, by which time a permanent solution would be negotiated. This was agreed during the ministerial held in Bali, Indonesia, last year. However, even if the council does so, the TFA may not be implemented by the next deadline of December-end. After meeting heads of delegations in WTO in October, Azevêdo had said the TFA deadline of December-end might not be achieved, even if all 160 members agreed to sign the deal Financial Astrology Trading Tips
The current WTO norms limit the value of food subsidies at 10 per cent of the total value of production on which subsidies are being given by way of minimum support price. This is called the de minimis level in trade parlance. The de minimis level for developed countries is fixed at 5 per cent. It remains to be seen whether other countries opposed to India's stance will agree to support it in December. "This sort of move sets a very dangerous precedent and undermines multilateralism. Let's not forget the WTO is a multilateral body where all members have to reach a consensus on a certain issue," said Biswajit Dhar, professor, Centre for Economic Studies and Planning at the School of Social Sciences, Jawaharlal Nehru University Free Share Trading Tips
The impasse had persisted since July when India stuck to its stance over having a parallel agreement on public stockholding for food security for its poor and marginal farmers, vetoing the much-awaited TFA Stock Market Trading Tips
The differences were resolved after the US agreed to accommodate India's concerns over food security during the upcoming general council (GC) meeting, the organisation's highest decision-making body, on December 10-11. "We are happy that India and the US have successfully resolved their differences related to the issue of public stockholding for food security purposes in the WTO in a manner that addresses our concerns," minister of state (independent charge) for commerce and industry Nirmala Sitharaman said here on Thursday Nifty Trading Tips
Apparently, the actual deal reached between the two early this month was that during the next GC meeting to be held at the WTO headquarters in Geneva, the US would support India's stand of having the so-called 'peace clause' agreed upon along with adopting the protocol of amendment of the TFA, officials in the commerce department involved in the talks told Business Standard. In other words, the US has agreed to support India's stand for having the 'peace clause' in perpetuity, which will make India immune to WTO complaints, until a permanent solution is sought. A permanent solution to the food stockholding issue entails amending the WTO's Agreement on Agriculture (AoA), talks for which will be expedited.
Therefore, neither the TFA nor the agreement on food stockpiling will be signed in December.
The GC in December is expected to only make a statement of intent that all members agree to have the 'peace clause' until a permanent solution on food security is reached Intraday Trading Tips
In Washington, US Trade Representative (USTR) Michael Froman said that the Bali package, which was held up in July after India raised concerns over the food security issue, would move forward. "We have overcome that delay and now have agreement with India to move forward with full implementation (of the Bali package)," he said. It is learnt that the US has also agreed to start negotiations for reaching a permanent solution on food stockpiling by creating an institutional framework that will lay the road map for the talks, which was one of the main demands made by India since the Bali ministerial took place in December last year. "This will end the impasse at the WTO and also open the way for implementation of the TFA... After the Prime Minister's visit to the US, there was greater understanding of India's position," Sitharaman said. Lauding the efforts put in by India and US trade negotiators, WTO Director General Roberto Azevêdo said it was a "significant step in efforts to get the Bali package and the multilateral trading system back on track Commodity Trading Tips
"It will now be important to consult all WTO members so that we can collectively resolve the current impasse as quickly as possible," Azevêdo said.
The European Union said it would look for the "next steps" on implementing all tenets of the Bali package, including "immediate adoption" of the trade facilitation protocol. "Implementation of the TFA will allow the WTO to resume work on other key aspects of the Bali deal, including advancing on the preparation of a work programme for the Doha Development Agenda (DDA), thereby setting us on a path towards the conclusion of the Doha round," said EU Trade Commissioner Cecilia Malmström. During the G20 Summit in Brisbane, leaders are also expected to explicitly state the movement expected on the WTO Bali talks. India, under the former UPA regime, was successful in achieving the 'peace clause' after a bitterly fought round of negotiations with the US. However, at that time it was decided that the clause would be applicable for four years until the 2017 ministerial meeting, by which time a permanent solution would be negotiated. This was agreed during the ministerial held in Bali, Indonesia, last year. However, even if the council does so, the TFA may not be implemented by the next deadline of December-end. After meeting heads of delegations in WTO in October, Azevêdo had said the TFA deadline of December-end might not be achieved, even if all 160 members agreed to sign the deal Financial Astrology Trading Tips
The current WTO norms limit the value of food subsidies at 10 per cent of the total value of production on which subsidies are being given by way of minimum support price. This is called the de minimis level in trade parlance. The de minimis level for developed countries is fixed at 5 per cent. It remains to be seen whether other countries opposed to India's stance will agree to support it in December. "This sort of move sets a very dangerous precedent and undermines multilateralism. Let's not forget the WTO is a multilateral body where all members have to reach a consensus on a certain issue," said Biswajit Dhar, professor, Centre for Economic Studies and Planning at the School of Social Sciences, Jawaharlal Nehru University Free Share Trading Tips
THE IMPASSE AND ITS RESOLUTION * 2013, Dec 7
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posted by Naresh Jain @ 21:26
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