Our man at the WTO

Trade policy and economic diplomacy require professionalism

The government of India has to find a new ambassador to the World Trade Organisation (WTO). The commerce ministry has the right to man the job, but the external affairs ministry says it has the right man for the job. Caught in the middle of an argument, the Prime Minister’s Office has done what it has become so habituated to doing. Postponed a decision!

There is merit in Commerce Minister Murasoli Maran’s argument that whoever represents India at the WTO must be answerable to the commerce minister and enjoy his confidence since he has the responsibility of defending government policy in Parliament. There is equal merit in the view ostensibly taken by the external affairs ministry and the PMO that the right man for the job is a certain senior foreign service officer who has specialised in trade policy and the WTO.

The person in question, Mr Hardeep Singh Puri, is currently Deputy High Commissioner for India in London. He has had a long track record, dating back to 1981, of dealing with the WTO’s earlier incarnation, the General Agreement on Tariffs and Trade (Gatt) and has more recently sat on various committees of the WTO’s dispute settlement body. Like so many talented members of the Indian civil service Mr Puri, a foreign service officer, has acquired a specialisation in the area and is no ‘generalist’. Arguably, there are other such specialists, both in the Indian Administrative Service and in various policy think-tanks who could also lay claim to this specialised job.

In any modern government a decision as important as nominating the ambassador to the WTO, particularly when the WTO is once again attracting domestic political opposition and is under attack from anti-globalisers the world over, would have been taken after due consideration of the individual merit of various contenders as well as factors pertaining to ministerial responsibility. The ambassador to the WTO is no ordinary diplomatic official. He has to be equally familiar with domestic economic issues and the needs of domestic enterprise as well as global and regional trends in trade and economic diplomacy.

In the past India has had some highly qualified persons manning this post, even if some were more ideologically hidebound than pragmatic. When Ambassador Narayanan, the present Indian representative at the WTO, was assigned to this post he was required to learn on the job, having had little previous experience in the area apart from having dealt with textile policy. Admittedly, his experience in the area of the Multi-Fibre Arrangement and textile trade policy and the learning time available between the conclusion of the Uruguay Round and the first ministerial meeting, helped him settle down to a reasonably good if lacklustre tenure.

His successor will not have the luxury of learning on the job because a new round may well be under way by year end and, more importantly, events in the area of international trade are moving at such a rapid pace that India will have to be extra smart and alert in coping with emerging and new pressures. Whoever succeeds Ambassador Narayanan will have to hit the ground running.

As always happens in India, the focus of controversy so far has been limited to who gets the job and whether it is the preserve of the IAS or not. While Ambassador Puri in London has the credentials, the manner of his appointment was needlessly controversial and the PMO has only itself to blame for the consequent mess.
However, more important than who finally gets the job is the more fundamental issue of how such decisions are taken. There is a total lack of transparency and, increasingly, an absence of a professional management system to identify the right persons for the right job. This is a wider problem of administration and governance where political and business lobbying, personal and parochial prejudice, and totally extraneous factors are being brought into play in selecting public officials for extremely important, sensitive and increasingly technical jobs. Be it chairpersons of regulatory and financial institutions and public sector enterprises, judges of various courts, secretaries to the government, ambassadors to key countries, heads of security organisations or educational institutions, and so on.

The management of trade policy in the increasingly globalised world with an increasingly outward-oriented national economy and with economic, political and strategic policy elements intertwined in complex ways, is a highly specialised job. It is instructive to note that the Bush administration has appointed a strategic policy expert as the US Trade Representative. The intimate links between foreign policy, economic diplomacy, trade policy and national security are visible to all those who care to see.

Interestingly, both professional economists and “turf-defending” civil servants in straitjacketed bureaucratic organisations like the government prefer to ignore this reality. Economists think trade policy is all about free markets, the price mechanism and the rational calculus. Government officials think it is just a question of managing lobbies. Diplomats think it is all a business of striking deals and looking at trade-offs.

Trade policy is a function of all these factors. What India needs is not just a well qualified trade diplomat at the WTO, but an entire edifice of strategic trade-policy making, integrating elements from various departments of government as well as business organisations, and an intellectually alive and policy-oriented strategic trade policy community throwing up a variety of practical policy options for policy makers. Currently no think-tank devoted to trade policy meets this need.

Both the government and business lobbies like CII and Ficci may be better equipped today than a decade ago in dealing with multilateral trade policy issues, but they still remain ill-equipped in dealing with the WTO and trade diplomacy. Professional trade economists, mostly divided into ideological camps of neo-classical market wallahs and anti-trade control wallahs, both slaves of imported ideologies, have also not helped shape pragmatic and strategic trade policy aimed at helping India globalise in an unequal world.

It is only when a larger pool of professionals and specialists is created that we can find suitable candidates to man the institutions of trade diplomacy. Till then it will have to be left to turf battles within and between the IAS and the IFS to throw up one transferable officer or another.