Modi-Obama meeting sealed trade deal, WTO says Bali package could be in force in 2 weeks

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Brisbane | Published: November 15, 2014 8:12:00 AM

Meeting on sidelines of East Asia Summit, Modi and Obama took forward their discussion in Washington in September.

Prime Minister Narendra Modi writes a message during a visit to Queensland University of Technology in Brisbane. (PTI) Prime Minister Narendra Modi writes a message during a visit to Queensland University of Technology in Brisbane. (PTI)

As President Barack Obama commended the personal leadership of Prime Minister Narendra Modi in finding the way forward on the WTO trade facilitation agreement (TFA), top Indian officials here said that it was at the meeting of the two leaders in Nay Pyi Taw this week that the deal was finally sealed.

Meeting on the sidelines of the East Asia Summit on Wednesday, Modi and Obama took forward their discussion in Washington in September, including on the ways to resolve the WTO deadlock. “I know you are a man of action,” Obama told Modi in Nay Pyi Taw.

“It’s not that this statement made the deal happen. But it did bring the issue to finality,” said an Indian government official in Brisbane on Friday.

In Washington, White House Press Secretary Josh Earnest said in a statement, “The President had extensive discussions with Prime Minister Modi on this (TFA) issue and appreciates his personal leadership in finding a path forward.”

Also on Friday, the WTO said that there was a “high probability” that a major deal on streamlining global Customs rules would now be implemented within two weeks.

“I would say that we have a high probability that the Bali package will be implemented very shortly,” WTO director-general Roberto Azevedo said in Brisbane, referring to the TFA agreed on the Indonesian island. “I’m hopeful that we can do it in a very short period of time, certainly within the next two weeks.”

India and the US on Thursday settled the dispute that had paralysed the WTO, and risked derailing the reforms that are seen adding about $ 1 trillion to global trade. The TFA relates to streamlining of Customs procedures by all WTO members to dramatically improve the movement of goods across countries, and bring down costs.

India had refused to bend on the issue of food security, linked it to the TFA and vetoed signing of the agreement. Every agreement at WTO requires consensus, and even a single member country can block a deal.

Subsequent to the India-US agreement, US Trade Representative Michael Froman issued a statement that said, “With the WTO confronting a mounting crisis of confidence, President Obama and Prime Minister Modi held productive discussions on this issue, including during the Prime Minister’s visit to Washington in September. In recent days, officials of both governments worked intensively and reached an agreement that should give new momentum to multilateral efforts at the WTO.”

Defending India’s position, Modi had earlier said the WTO had to move forward simultaneously on all agreements reached in Bali, including on food security, to address the concerns of all sections of society, including the poor.

At an Idea Exchange programme of The Indian Express at the end of August, Commerce and Industry Minister Nirmala Sitharaman had said, “PDS, efficient use of subsidy or how many people will benefit from PDS are all issues we in India have to decide for ourselves. That is no way going to be driven by WTO.”

Railway Minister Suresh Prabhu, who is also the Prime Minister’s sherpa for G20, too had said that if development issues were put on the back burner all the time, India could not be accused of being the spoiler.

(With PTI in Washington and Reuters in Brisbane)

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