EU Sees Indias Counter-proposal On Farm As A Trip To A Different Galaxy

Written by Malcolm Subhan | Brussels, September 8: | Updated: Sep 9 2003, 05:30am hrs
If it were a tennis match, you could describe it as a mens doubles - Arun Jaitley and Rajnath Singh vs Pascal Lamy and Franz Fischler. Or you could view it as a battle on a global scale, in which the Indian farmers are fighting against their European counterparts for their very livelihood.

Mr Lamy, chief trade negotiator for the 15-member European Union (EU), and his colleague, Franz Fischler, the EUs agricultural Commissioner, certainly view their Indian counterparts with some trepidation.

The event in question is the meeting of trade ministers from the 146 countries that make up the World Trade Organization (WTO), which opens in the Mexican resort town of Cancun (148 hotels) this Wednesday. It is a make-or-break meeting for the Doha Development Round of trade negotiations, launched in the Qatari capital nearly two years ago.

That meeting of WTO trade ministers has gone down in folklore as a ding-dong struggle between Mr Murasoli Maran and Mr Lamy with victory going to Indias commerce minister.

Asked about the joint counter-proposal drawn up by India and Brazil to the EU-US agreement (on agriculture), by the French counterpart to this newspaper, Commissioner Lamy went on the defensive.

Their text amounts to a declaration that the US and Europe must make the biggest effort, Mr Lamy told the newspaper Les Echos. Ever the combative Frenchman, he added: But their positions basically are not the same: Brazil wants access to the agricultural markets of other countries, while the last thing India wants is to open up its domestic agricultural market. Its essentially a question of tactics, which shouldnt surprise anyone.

The Austrian Franz Fischler, who is the EUs agricultural No. 1, was just as combative. I know trade talks are also about posturing and rhetoric, he told the International Press Corps here. But one should not overdo it. If I look at the recent extreme proposal co-sponsored by Brazil, China, India and others, I cannot help the impression that they are circling in a different orbit.

Mr Fischler then went into an orbit himself. If they want to do business, they should come back to Mother Earth. If they choose to continue their space odyssey, they will not get the stars, they will not get the moon. They will simply end up empty-handed.

There was no stopping the EUs agricultural commissioner after that. He described as a nice PR stunt the claim that the EU was spending two US dollars per cow (and per day, in subsidies). Yes, he went on, in the developed world we are spending money on many things. Not because we are all stupid, but because our standard of living is higher.

His message to Mr Jaitley and Mr Rajnath Singh was clear: We will vigorously defend our right to support our farmers. It is not up to the WTO, to some of our trading partners, to tell us that we have to wipe out European agriculture, with all the jobs, the environmental benefits, the cultural heritage our farmers provide.

The EU Trade Commissioner was more measured in his defense of subsidies for farmers. To begin with, growing food was not the same thing as making tyres for motor cars. Agriculture renders a service to the public. Mr Lamy challenged the claim, put to him by Les Echos, that the EU was dumping its food surpluses on world markets.

The WTO, the Trade Commissioner noted, does not define dumping of farm products Dont tell me were dumping when we use aid to compensate for the fact that our farms are 20 hectares on average in size, against 200 hectares in the US and 400 in Argentina, when we favour the well-being of animals, the environment or food safety. Through our choices were adding to production costs; its therefore normal that farmers should be able to off-set these increases in part.

For India - indeed, for the majority of developing countries - progress on the agricultural front is perhaps the key issue confronting trade ministers this week. But for the EUs chief trade negotiator, agriculture is just one of the many issues WTO trade ministers must deal with.

Speaking to the European Parliament, Mr Lamy told MEPs that the Cancun meeting is the half-way point in the Doha Development Round of negotiations. What is really at stake is to know if the negotiations can be successfully concluded by the end of 2004. The trade ministers must therefore have concluded at Cancun nearly 50% of the negotiations on all the subjects (before them). It was very important that there is progress on all the files at a comparable speed, Commissioner Lamy told MEPs.

This is because the outcome of the Doha Development Round must be a single undertaking, subscribed to by all WTO members. In other words, nothing is agreed until everything is agreed.

However, on the so-called Singapore issues, such as investment, WTO ministers must decide at Cancun whether or not to include them in the current round of negotiations.

The fact is that there has been no sign of a compromise on this issue, as Mr Lamy has pointed out, given that most developing countries are firmly opposed to adding the Singapore issues to what they see as an already heavy workload.

But the EU Trade Commissioner had words of encouragement for India, specifically on the issue of investments.

India, he told Les Echos, has no reason to refuse multilateral legislation on investments, given that its national legislation is perfectly within future standards, and that it is entering into bilateral agreements with other countries.

Will Mr Jaitley and Mr Lamy be able to agree on anything at Cancun The outlook is not so bleak. There is at least one issue on which they will stand shoulder-to-shoulder against the United States, New Zealand, Australia, Canada - and even Mexico.

It is the issue of geographical indications (GIs). The EU wants local producers to have the exclusive use of what it considers to be a geographical indication. Wines, for example, cannot be described as champagne, unless they come from the Champagne region in France.

Mr Fischler and Mr Lamy are confident that they can count on the support of India, Pakistan, Sri Lanka and other developing countries on the issue of GIs.As they see it, India and Pakistan are worried about multinationals patenting and selling basmati rice and Darjeeling tea.