India?s Farm, Fishery Exports To EU Rise 46% In 1995-2002

The good news is the 46 per cent rise in India?s exports of agricultural and fishery products to the 15-nation European Union (EU) between 1995 and 2002.

Indian exports went up from 861 million euro to 1.3 billion euro over this period, although India?s share of the EU market remained at two per cent of the EU?s imports from non-EU countries.

India?s share of South Asian exports to the EU was just over two-thirds of the total in 1995 (1.3 billion euro) – and again in 2002 (1.9 billion euro). The exports of all South Asian countries, including India, rose by 46 per cent between 1995 and 2002, while their share of the EU market went up from two per cent to three per cent. Chinese exporters of agricultural and fishery products saw their exports rise from 1.1 billion euro to 1.7 billion, a growth of 52 per cent between 1995 and 2002, while their share of the EU market went up from two per cent to three per cent. Indonesian and Thai exporters did less well: their exports rose by 30 per cent and 20 per cent respectively between 1995 and 2002. Indonesian exports stood at 1.4 billion euro and Thai exports at 1.3 billion euro in 2002.

The not-so-good news is that when it comes to agriculture, the EU is digging in its heels in the Doha Development round of trade negotiations. Both the EU?s foreign trade supremo, Pascal Lamy, and his agricultural colleague, Franz Fischler, take the view that the Doha round ?will only succeed if other major players also start moving from their entrenched positions.?

What is more, they strongly urge the largest and most advanced developing countries, like India, China and Brazil, to provide preferential access to their markets to the much larger number of developing countries in need. In short, the G-20, led by these three countries, should open their markets on a preferential basis to the G-90. This group, like the G-20, emerged at the WTO ministerial meeting in Cancun in September. The G-90 includes the least developed countries, such as Bangladesh, and 70-odd developing and least developed African, Caribbean and Pacific countries linked to the EU through the Cotonu agreement.

For the EU, agricultural trade liberalisation by the developed countries alone is not enough. Increased South-South trade is essential, because demand for food is expected to rise in developing countries. It is here that most of the future growth in and benefits from trade are likely to arise, according to the strategy paper drawn up by the European Commission, the EU?s trade negotiating arm, in preparation for the December 15 meeting in Geneva of the WTO?s 148 member countries.

The Commission?s strategy for relaunching the Doha development round is seriously flawed: the paper now before the EU Council of Ministers completely ignores the most important development since the round was launched in the Qatari capital in 2001.

This is the emergence of the G-20 and G-90. The European Commission?s paper notes that ?developments such as the emergence of new groups, such as the G-20 and G-90?cannot be ignored or brushed aside,? and then proceeds to ignore this key development.

Franz Fischler, who drafts the EU?s farm policy, is quite clear in his own mind. Commenting on the strategy paper which he helped write, he said here earlier this week, ?We have fundamentally reformed our farm policy, we have substantially moved from our initial position?We fully acknowledge that developed countries have to do more than developing countries, but the strong exporters (read India, China, Brazil, South Africa?) have to do their bit as well.?

The European Commission?s strategy paper, which will be the basis of the EU?s position at the December 15 meeting in Geneva, accepts that developing countries ?should have more flexibility to address their domestic needs, including the needs of poor farmers.? Such treatment should be targeted, however, ?particularly to the poorer, less competitive developing countries, as opposed to the most advanced.?

Faced with the opposition of the US, Canada and Australia, the EU will be taking a softer line on geographical indicators. These include not only French wines but also Darjeeling tea, for example. These indicators are described as ?a marketing tool, a store of value and a source of legitimate proprietary pride? in the Commission?s strategy paper.

The EU?s chief trade negotiator, Pascal Lamy, admits that his strategy paper contains no ?fundamental changes.? This is because he believes that the offer on agricultural products, which the EU jointly tabled with the US, has yet to be discussed seriously by the other WTO members.

In any case, ?we haven?t necessarily put on the table everything that we have in our pockets,? Mr. Lamy told a leading French newspaper.

The strategy paper is silent on the issue of commodities generally. The EU?s Trade Commissioner however supports the launch of a commodity initiative with the WTO, aimed at raising the profile of the issue. Indeed, Mr. Lamy plans to adopt a commodity action plan early next year.

The World Bank?s Trade Director, Uri Dadush, is sceptical of the strategy now put forward by the EU?s Trade Commissioner. ?Frankly, I doubt that (it) can serve as the basis for relaunching the negotiations,? he declared, during his visit to Brussels to meet with ministers from the African, Caribbean and Pacific countries linked to the EU through the Cotonu agreement.

(One euro was worth $0.76 in 1995, and $1.06 in 2002.)