Be proactive instead of defensive in approach

Updated: Nov 17 2005, 05:30am hrs
India should adopt a proactive strategy in WTO farms negotiations rather than be defensive. It should make a clear offer for tariff cuts, conditional on steep cuts in domestic support in the US and the European Union. The draft text for negotiations should include concrete measures for making Hong Kong ministerial a success. If the negotiations fail to achieve measures for ensuring free and fair trade, a fiasco at Hong Kong is better than a hollow round.

The trade negotiators should call for a tiered formula for cuts in overall trade-distorting support - to, say, 5% of the value of production. Total aggregate measures of support (AMS), product specific AMS, de minimis support and blue box subsidy should be squeezed. For developing countries, there can be a lower limit for overall trade-distorting support. Article 6.2 should not be changed, but properly clarified. Direct payments under Green Box should be limited to small and marginal farmers.

Regarding export competition, the proposed period of five years for elimination of direct export subsidies should be maintained. While developing disciplines on export credit for under 180 days, the possibility of any exceptions or slackness should be ruled out. Fundamental changes in the food aid programme should be effected to ensure that it does not distort trade. The state trading enterprises engaged in exports should not have monopoly rights. Special and differential treatment should be conferred on developing countries only on the basis of longer period for implementation.

As for market access is concerned, capping of tariffs is a critical issue. There are issues on the table like single approach system, progessivity in reduction and flexibility for sensitivities, tiered formula for reduction of tariffs , selection of sensitive products for developed countries and special products for developing countries and special safeguard mechanism.

Based on a paper by Anwarul Hoda & Ashok Gulati