Second, in EU, no substantial revamp of Common Agricultural Policy (CAP) is possible before 2012. Thus, any agro liberalisation will be capped by a French letter. Third, with global food price inflation and agro export curbs in many countries, this is not the best of times to mention agricultural liberalisation. Net agro exporters are a trifle more reluctant. So are net agro importers, since elimination of developed country subsidies will increase global prices. Fourth, India is in election mode and agriculture is politically sensitive. No cabinet will be keen to touch it. Casabianca wouldnt move without his fathers word. The flames rolled onhe would not go, without his Fathers word; That father, faint in death below, His voice no longer heard. True, there is an argument that with domestic political economy of agricultural reforms proving intractable, an international commitment might provide the catalytic trigger. But this isnt an argument that will find takers. The only person keen to broker consensus is Pascal Lamy, whose term expires in 2009. Lamy apart, why should anyone be interested in premature delivery of DDR before 2010, with agreements that bite before 2013 That doesnt spell death for WTO. It continues to administer Uruguay Round (1986-94) agreements and the multilateral system has faced such rocky patches earlier.
However, there is a fundamental concern. Barring instances of accession, WTO hasnt been successful in pushing liberalisation. That has happened unilaterally or regionally. It is difficult to push consensus with 153 members, when in principle, a single country can block agreements through a veto. In practice, whatever WTO agreements may say about democracy, all countries arent equal. Consequently, during the Uruguay Round, the US and EU agreed on the Blair House Accord in 1992 and rammed it down throats of other countries. The maligned green-room processes, to which not all countries were invited, were no different. Since then, what has changed across coalitions like Nama-11, G-20, G-33 and so on, is increasing economic clout of some developing countries (India, Brazil, China, South Africa, Argentina) and their collective unity, despite carrots and sticks. At the current Geneva high table, the G-7 includes India, Brazil and China, in addition to the US, EU, Japan and Australia. The other 35 countries assembled in Geneva serve by standing and waiting. If G-7 agrees, so do they, and so do all WTO members. In agriculture, India, Brazil and China dont have similar interests. Unity in demanding market access in developed countries is easy.
But that unity breaks when it comes to liberalising in developing countries. It is true that US/EU/Japan offers on reducing subsidies and agro tariffs arent enough, especially because they work on capped levels rather than actuals. It is also true that present Nama coefficients amount to less-than-full-reciprocity for developed countries, rather than developing ones. However, Brazil seems to have been weaned away, less by Nama and probably more by winning a cotton subsidy dispute with the US, extension of the EUs ACP (Africa-Caribbean-Pacific) preferences to Latin America and agro barriers in developing countries (soyabean in China). It is odd that the EU should protect bananas, when no bananas are produced anywhere in the EU. They are only produced in former EU colonies. Americans are right in blaming India and China. India was offered the banana-carrot of more service sector visas. But having voted in favour of a trust motion in Delhi, Kamal Nath didnt ditto it in Geneva. At one point, China was almost weaned away. That would have left India in the familiar Casabianca status. Since India is unlikely to agree, the Geneva meeting will probably amount to nothing. But a question remains about Indias PR and coalition-building exercise. Why were Brazil and China weaned away
The author is a noted economist