The failure of the Cancun ministerial talks of the World Trade Organisation seems to have generated a sense of optimism that developing countries (DCs) have at last found their voice. Doubtless, the emergence of DC alliances on agriculture and Singapore issues have injected some balance in WTO negotiations that have thus far been driven by the agenda of advanced nations. However, the breakdown at Cancun should not lull India and other poor countries into believing that they have succeeded in protecting their trade interests.

Let there be no mistake that the advantage for countries like India lies in making an all-round effort for the revival and successful conclusion of the Doha round, and not in celebrating Cancun?s outcome. This needs to be said as there are a good number of those who believe that India should remain in the WTO only on its own terms. There are others that argue that, now that the Doha round could fail, India should look at alternatives to the WTO by striking bilateral and regional trade deals.

There may be merit in exploring bilateral and regional trading pacts but these are not even second-best solutions, and to think that these could replace the advantage that India derives from the WTO would be to bark up the wrong tree. What is more, to tread this path is to fall into the trap of the advanced world. The European Union and US are working precisely on this strategy to weaken the unity and resolve of poor countries.

The EU is already on its way to negotiating a new trade agreement with 20 African nations and this deal could subsequently spread to cover more countries from the ACP (African, Caribbean and Pacific) group of 77 DCs that receive preferential treatment on some of their exports to EU. The EU is also negotiating with the Mercosur group of nations that include Brazil, Argentina, Paraguay and Uruguay. Not to be left behind, the US too is in dialogue with six African nations and has promised to strike free trade deals with Bahrain and the Dominican Republic. This is in addition to the free trade agreements the US had recently signed with Singapore and Chile.

US trade secretary, Bob Zoellick, has publicly stated that following the failure at Cancun, the US would now opt for bilateral and regional arrangements. With the US running a record $500 billion trade deficit, Zoellick?s strategy would find political support in the run-up to the US Presidential poll to be held next year. The possibility that bilateralism and rising protectionism in the US could fracture the world trading system is brighter now than at any other time over the last decade. Should that happen, India?s trading interests would suffer.

Consider the facts. The bulk of India?s exports is to OECD markets and bilateral or regional trade deals with ASEAN or south Asian nations cannot compensate for losses suffered in OECD markets. Indeed, if one looks at our export basket, the importance of US and EU markets cannot be over-emphasised. Take any product such as textiles, software, engineering and automobiles, pharmaceuticals or marine and agricultural products ? there is overwhelming dependence on either the US or EU. The globalisation drive of most of our competitive companies is centered on penetration of these markets.

One could, of course, try negotiating bilateral deals with both the US and EU. But if 22 DCs put together could not get a favourable outcome at Cancun, it is plain that any bilateral negotiations that India may contemplate with the US or EU would deliver more benefits to them than to us. We must also remember that unlike most DCs, India has competitive potential in all the three sectors viz agriculture, manufacturing and services, and would therefore reap maximum gains from a trading regime governed by transparent multilateral rules.

India?s future role is, therefore, clear. It must convince all DCs that they must close ranks to prevent bilateralism and regionalism and ensure the success of the Doha round. Multilateralism is the only route to protect the interests of small trading nations such as India. Commerce minister Arun Jaitley has rightly stated that we must be prepared for compromises in some areas to score gains in others.

The author is an advisor to Ficci. Views expressed herein are personal