The draft is good one for restarting the multilateral trade negotiations, but there are some gaps and areas where clarity is needed. We will take up these issues when the talks are scheduled to begin in September this year, commerce secretary Gopal K Pillai told FE.
The right of the developing countries to designate Special Products (SPs) and the use of Special Safeguard Mechanism (SSM) with a view to protect the livelihood of farmers and for ensuring food security are vital issues which India is likely to raise in the September meeting.
We are for indicator-based selection of SPs and not for just determination of SPs on the basis of a specific percentage of the tariff lines. We are a multi-crop producing country and farmers' livelihood is involved in cultivation of many of these crops. The appropriate indicators for SPs need to be worked out in detail, Pillai said.
SPs would allows protection through maintaining reasonable level of bound tariffs which would not come under reduction commitments.
Pillai said that the right to designate SPs by developing countries should not be negotiated on the basis of quid pro quo with the developed countries for designation of their Sensitive Products. Both are two different aspects, he said.
Another issue which India is likely to insist upon is that the developed world switch over from ad valorem duty structure on certain farm products to a specific duty structure, before making commitments on duty cuts.
India will also urge for greater flexibilities for developing countries in matters of tariff reduction with a view to check the influx of cheap subsidized imports from the developed world.
The recent WTO farm draft has proposed that the US should cap its trade-distorting support excluding the Green Box subsidy in the range of $ 13-16.4 billion, while the US has offered to reduce it to $ 17 billion.
The G-20 group of countries, including India has demanded that it should be capped at $ 12 billion. The draft has proposed that the European Union cap its trade-distorting support in the range of Euro 16.5-27.6 billion. The most important is the selection of the base period for effecting the subsidy cut formula. In the years when the global prices rule high, the level of subsidy in the developed world, particularly in US comes down.
When global prices are depressed, the level of subsidy rises, said Pillai.
India feels that though the draft has called for elimination of export subsidies by 2013, the ambition on volume commitments remains to be addressed. India will initiate a discussion on geographical indications for specific crops and products of developing countries.