No Obama silver lining for WTO talks, says India

While it is assessing the impact of the recent important developments on the progress of the Doha Development Round negotiations of the World Trade Organisation?including WTO director general Pascal Lamy seeking a second term in office, Barack Obama being elected as the new US President and the worsening global financial turmoil?India on Thursday said it is not expecting the talks for a global trade deal to accelerate towards conclusion.

However, trade analysts and industry sources said they expect that the new US administration would be more protectionist in their approach and push harder for market access in developing countries for their industrial goods in return for any slight concession in talks on agriculture.

Asked if there was any possibility of the Doha Round talks being concluded before Obama assumes office in January, a senior commerce ministry official said, ?There is a process going on in Geneva. No amount of button pushing from the (national) capitals is going to make the members accelerate that process. It has a traction of its own.?

On Wednesday, the WTO Chairs of Agriculture and Non-Agricultural Market Access (NAMA or industrial goods) met and discussed the new developments, the official said, adding, however, that the talks have so far not been able to make much headway. ?Heads of negotiating groups on agriculture and industrial products feel there is no traction … they are not very optimistic about getting to conclusion,? he said. He added that both the Chairs would soon put out their respective reports regarding the talks so far.

The Doha Round talks had commenced in 2001 at the Qatari capital to liberalise global trade in agriculture, industrial goods and services. However, it has failed to meet several deadlines that were set earlier. The aim of the global leaders was to conclude it by the end of this year.

The official said the factors that would be more important would be on the new announcements on WTO and international trade policy by the Obama government and the appointment of the new US Trade Representative (USTR).

?The question is … they (US) have to appoint a new USTR and make new announcements (on trade and WTO),? the official said.

The outgoing USTR, Susan Schwab, at the July Geneva mini-ministerial meeting of the WTO, had offered to the US overall trade distorting farm subsidies (OTDS) to $14.5 billion from around $48 billion in exchange for significant market access for its agriculture and industrial goods in developing countries.

But the talks had failed in July mainly due to differences between India and the US over safeguards to protect poor farmers in developing countries from import surges of agricultural products.

Trade experts said the international economic environment has changed considerably due to the economic crisis and this would have a major impact on trade talks as well.

?The political and economic scenario is different now. There are certain issues that the President elect Obama had mentioned in his campaign which can impact Indian economy,? said Biswajit Dhar, Head, Centre for WTO Studies, Indian Institute of Foreign Trade.

According to reports, the Obama administration would put more focus on creating and preserving jobs in the US and rebuilding the economy of that country rather than give higher priority to an early conclusion of the Doha Round talks. The new US government may also reopen bilateral trade agreements.

Dhar said the Indian government would have to reprioritise and set new goals in agriculture, industrial goods and services, taking into account the changed circumstances.

Pradeep Mehta, trade expert and secretary general, CUTS International, said ?there is bound to be increased protectionism due to the financial meltdown and it is necessary to get a higher traction on the Doha Round talks and conclude it as early as possible.?

The official said though India welcomes the decision of Lamy to seek re-election as WTO DG, a final call will be made at the time of the elections.

On November 4, WTO General Council chairperson Bruce Gosper informed WTO members about Lamy?s announcement seeking a second term in office when his current term expires in August 2009.