The WTO is a curious creature. Formed with the objective of promoting the universal economic good, free trade, it is more often that not held hostage by mercantilist (give but only if you get something) or narrow national (read protectionist) interests. Also, hailed as the most evolved international organisation mainly because of its truly democratic constitution (one nation one vote), it suffers from all the problems that other ?less evolved? international organisations do?chiefly lethargy and indecision. It?s hardly surprising that the Doha Round has been going for eight years now?many of the previous successful rounds took a decade in negotiating.
Viewed by itself, the much celebrated Delhi ?mini-ministerial? did not seem to yield anything worthy of being tagged a ?breakthrough?. However, when put in the context of the painful and protracted process that multilateral trade negotiations at the WTO are, the Delhi meeting, and by transitivity its host and chair, India, can claim some success.
Remember that the meeting on September 3 and September 4 was not a forum for negotiations, but a forum instead to kick-start negotiations that have now been stalled for over a year. The last time serious negotiations were attempted, in July 2008, they ended with such deep disagreement that Pascal Lamy, Director General WTO, was forced to temporarily suspend the Doha round. In the interim between then and now, ambassadors in Geneva tried to talk but with no serious interest from key capitals. The crucial ?breakthrough? achievement of the Delhi meeting is, therefore, that in about a week from now, starting September 14 chief negotiators deputed from country capitals (where all key decisions end up being made) are to re-start formal negotiations.
The fact that India insisted on inviting a diverse range of countries to the Delhi meeting, rather just a select few players lends the imminent negotiations more legitimacy than if they had been propelled by just a group of 4 or 5 key countries. The commerce ministry must, therefore, get credit for their organisation and chaperoning of this meeting.
That?s all very clear and perhaps well known. What?s in fact more interesting is the subtext of the Delhi meeting.
For Indian trade diplomacy, this meeting marks a significant departure in tactics. For a long time now, India has been viewed as the major obstacle to the conclusion of a new round of trade talks. Successive commerce ministers from India cutting across different governments?Murasoli Maran, Arun Shourie (very briefly), Arun Jaitley, all NDA and Kamal Nath, UPA I?made a global name for themselves as defenders of the interests of developing countries, by repeatedly (and often single-handedly) stalling crucial meetings of the WTO.
Of course, it can be nobody?s case that a bad deal is better than no-deal?there were no doubt occasions when India was justified in putting a spoke in the wheel?but acquiring the reputation of the perpetual game spoiler wasn?t necessarily in India?s best long term interest. Multilateralism is a difficult game, but it?s the best game?most equitable and most beneficial on the whole?in town.
India can stall the WTO, but only at the cost of ?trade diverting? free trade areas (many of which we have signed ourselves). In the longer term, it is the smaller developing countries (whose interests we claim to represent) which are hurt because of regional FTAs between bigger players.
Now, however, by hosting a meeting which has kick-started negotiations, India may have made the crucial change from being a disruptive spoilt sport, to a more constructive facilitator of multilateral trade talks. For Indian trade diplomats, this is perhaps the biggest achievement of the ?mini-ministerial? in Delhi. It positions us better for the negotiations when they restart?it will be difficult for other countries to pin us down as the spoilers if things do not go according to plan (always likely in complex negotiations).
There is, of course, another interesting subtext to India?s changed position. And that is the change of regime in the US in January this year. As long as the free-trading Republicans and George W Bush were in charge, the US was likely to agree on some deal.
Now, the reality of a Democratic administration and democratic majorities in the US Congress?both instinctively against free trade?will shift the onus of a real breakthrough to the US. India will, of course, have to concede some ground, most likely on agriculture and safeguards, but it will demand something in return, most likely on services, but also agricultural subsidies. It will be interesting to see how the current US administration responds (and not just to India?s demands). If they fail to budge on issues of concern, particularly to developing countries, then it will be clear who the spoiler really is.
The real game begins now, but India?s trade diplomats have already scored.
?dhiraj.nayyar@expressindia.com