US, India work overtime to keep Bali deal on track

Written by fe Bureau | New Delhi | Updated: Aug 1 2014, 13:49pm hrs
USUS secretary of state John Kerry greets Ratan Tata with US secretary of commerce Penny Pritzker before a dinner at the US ambassador?s residence in New Delhi on Thursday.
The July 31 deadline for the Trade Facilitation Agreement (TFA) at the World Trade Organisation is not inviolable, India said in an amended statement for the world bodys general council late on Thursday, despite tenuous support for its case for bundling the TFA with the food security issue.

While visiting US leaders secretary of state John Kerry and commerce secretary Penny Pritzker who had meetings with senior Indian ministers during the day hoped for a last-minute breakthrough, official sources said New Delhis stance is unchanged but added that the countrys latest statement to the council suggested a way to end the deadlock.

Stressing that substance rather than process was paramount, New Delhi said a permanent solution to the issue of public stockholding for food security was integral to the Bali ministerial deal, sources said, quoting the countrys revised statement.

Our new proposal is like a solution to the stalemate. If they accept it, the deal can be signed even today. But if they (developed countries) believe the deadline is more important, they should agree now to what we are saying or move to a new deadline and then accept our proposal, a senior government official said.

Kerry said after a meeting with external affairs minister Sushma Swaraj: There is a meeting going on in Geneva. Our feeling is that the agreement in Bali was important for India. We do not dismiss Indias concerns on food subsidy. We are trying to encourage India to reach a compromise.

Swaraj, however, maintained: Let us wait for the final outcome of the (Geneva) meeting.

Separately, commerce minister Nirmala Sitharaman said Indias stand was the same (as earlier) and New Delhi remained firm. Commerce secretary Rajeev Kher, who was present at Sitharamans meeting with Pritzker, said India has suggested a way to break the deadlock.

The permanent solution, as India envisages, would give developing countries more liberty to subsidise its farmers including by giving them a minimum support price for their produce. As for India, relaxation of the cap for stockholding of foodgrains would help it implement the National Food Security Act, which envisages providing highly subsidised food to two-thirds of its people.

As per the December 2013 Bali Ministerial declaration, the deadline for member countries to sign a TF protocol would end on Thursday. Hectic parleys are on at the WTOs Geneva headquarters to arrive at a deal. The TFA, however, will take effect only if at least two-thirds of the members ratify it by July 31, 2015.

Indias new statement remains within the broad contours of its July 25 statement that suggested a four-point course of action including setting up a special session of the committee on agriculture to ensure clear-cut procedures, timelines and outcomes to arrive at a permanent solution on food security as well as on least developed countries issues by December 31, 2014.

New Delhi had also sought a review of the progress of these accelerated discussions in October 2014 by the General Council.

Officials also noted reports of a handful of developed countries beginning discussions of alternatives, including the possibility of leaving out India from the TF agreement, if the July 31 deadline is not met. They, however, dismissed it saying such possibilities are remote as WTO agreements can be done only through a consensus approach.

We believe that not a temporary waiver (from giving subsidies for traditional staple food crops in pursuance of public stockholding programmes for food security purposes) but only a permanent solution on food security is part of the Bali package, an official said.

On agriculture, the key issue is public stockholding for food security purposes. WTO norms say public stockholdings cannot be over 10% of the value of foodgrains produced. India is challenging the calculation of public stockholding at the base price of 1986-88 citing inflation and currency fluctuation since then, and wants the base year to be changed.

India also wants to ensure that not an interim mechanism but a permanent solution for the issue of public stockholding for food security purposes should be ready for adoption by the 11th Ministerial Conference in December 2017. India also wants to ensure that till a permanent solution is found, no member shall challenge through the WTO Dispute Settlement Mechanism, the support provided by other members for traditional staple food crops in pursuance of public stockholding programmes for food security purposes.