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Rich-poor battle over Uruguay Round implementation 

S Venkitachalam  
New Delhi, Nov 21: The fate of the draft ministerial declaration (DMT) drawn up by the WTO General Council for the Seattle Round of trade negotiations hangs in balance thanks to the "intransigent" positions taken by both developed and developing countries on the inclusion of implementational issues in it.

While suggestions by developing countries on several implementation issues arising from the Uruguay Round have already found a place in the declaration, there is stiff opposition from developed countries to going further. The latter strongly believe that these will amount to "renegotiation" of several Uruguay Round agreements. The proposals are currently under discussion in the General Council which had circulated the draft to members on October 19. "There is little clarity at this point of time on the ultimate position of many of the important WTO members who may ultimately decide the fate of DMT", says a background paper on the third Seattle ministerial conference prepared by the commerce ministry.

Thesituation is "dynamic" and may undergo changes "as we get closer to the conference and members come back to the negotiation table with fresh mandates from their respective governments",the paper says. The implementation concerns raised by India include imbalances in the agreement on trade-related intellectual property rights (TRIPs), agreement on textiles and clothing, non-implementation of special and differential treatment clauses in favour of developing countries and on the rules and procedures governing the settlement of disputes.

Besides, negotiations are already mandated under the agreement on agriculture and the general agreement on trade in services due on January 1, 2000.

On the other hand, some developed countries led by the European Union are pressing for a multilateral agreement on investment. The US, however, is not keen to get this item included in the negotiating agenda at Seattle. Both the US and EU are also equally divided on yet another major issue-trade and competition policy-on whichthe WTO working group has still not drawn any conclusions. India, for its part, would like to autonomously strengthen the domestic competition law, if necessary by enacting a new legislation, but will not agree to any multilateral framework on the subject.

On industrial tariffs, which is also bound to be raised by developed countries, the commerce ministry paper believes that it may result in increased competition for Indian industry. On the other hand, lowering of tariffs in the major markets may mean greater market acess for Indian exporters.

Though developed countries have reduced tariffs after the Uruguay Round, the average tariff level of 3.8 per cent is "misleading" because of the existence of "tariff peaks" and the phenomenon of "tariff escalations", particularly in products of export interest to India and other developing countries. For instance, Japan has 160 per cent tariff on footwear with leather uppers, US has 79 per cent on raw cotton, 58 per cent on sports footwear with textile uppers and33 per cent on watch movements. The EU has 22 per cent duties on some women's dresses. In this context, the paper says that unless there are definite commitments on the removal of non-tariff barriers, a mere reduction or elimination of tariff peaks will be of no avail.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.

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