I/II. http://economictimes.indiatimes.com/news/economy/foreign-trade/wto-fails-to-reach-an-agreement-on-1-trillion-customs-deal-as-india-remains-firm-on-its-demand/articleshow/39386192.cms
WTO fails to reach an agreement on $1 trillion customs deal as India remains firm on its demand By Reuters | 1 Aug, 2014, 09.36AM IST NEW DELHI/GENEVA: The World Trade Organization failed on Thursday to reach a deal to standardise customs rules, which would have been the first global trade reform in two decades but was blocked by India's demands for concessions on agricultural stockpiling. "We have not been able to find a solution that would allow us to bridge that gap," WTO Director-General Roberto Azevedo told trade diplomats in Geneva just two hours before the final deadline for a deal. "Of course it is true that everything remains in play until midnight, but at present there is no workable solution on the table, and I have no indication that one will be forthcoming." The deadline passed without a breakthrough. WTO ministers had already agreed the global reform of customs procedures known as "trade facilitation" last December, but it needed to be put into the WTO rule book by July 31. Most diplomats saw that as rubber-stamping a unique success in the WTO's 19 year history, which according to some estimates would add $1 trillion and 21 million jobs to the world economy, so they were shocked when India unveiled its veto. Trade experts say Thursday's failure is likely to end the era of trying to cobble together global trade agreements and to accelerate efforts by smaller groups of like-minded nations to liberalise trade among themselves. India has been vocal in opposing such moves, making its veto even more surprising. "Today's developments suggest that there is little hope for truly global trade talks to take place," said Jake Colvin at the National Foreign Trade Council, a leading US business group. "The vast majority of countries who understand the importance of modernizing trade rules and keeping their promises will have to pick up the pieces and figure out how to move forward." Some nations have already discussed a plan to exclude India from the agreement and push ahead regardless, and the International Chamber of Commerce urged officials to "make it happen." "Our message is clear. Get back to the table, save this deal and get the multilateral trade agenda back on the road to completion sooner rather than later," ICC Secretary General John Danilovich said. US Secretary of State John Kerry, on a visit to New Delhi, had earlier said he was hopeful that differences between India and much of the rest of the world could be resolved. But after Azevedo's speech, US Ambassador to the WTO Michael Punke was downbeat. "We're obviously sad and disappointed that a very small handful of countries were unwilling to keep their commitments from the December conference in Bali, and we agree with the Director-General that that action has put this institution on very uncertain new ground," Punke told reporters. India had insisted that, in exchange for signing the trade facilitation agreement, it must see more progress on a parallel pact giving it more freedom to subsidise and stockpile food grains than is allowed by WTO rules. It got support from Cuba, Venezuela and Bolivia. NDA government has insisted that a permanent agreement on its subsidised food stockpiling must be in place at the same time as the trade facilitation deal, well ahead of a 2017 target set last December in Bali. Kerry, whose visit to India was aimed at revitalising bilateral ties but was overshadowed by the standoff, said the United States understood India's position that it needs to provide food security for its poor but India would lose out if it refused to maintained its veto. DEAL WITHOUT INDIA? Diplomats say India could technically attract a trade dispute if it caused the deal to collapse, although nobody wanted to threaten legal action at this stage. The summer break will give diplomats time to mull options, including moving ahead without India. Technical details would still have to be ironed out, but there was a "credible core group" that would be ready to start talking about a such a deal in September, a source involved in the discussions said. II. http://firstbiz.firstpost.com/economy/explained-what-the-wto-trade-row-with-india-is-all-about-92482.html Explained: What the WTO trade row with India is all about By Firstbiz Staff Reuters The 160 members of the World Trade Organization failed on Thursday to reach a deal to standardise customs rules, which would have been the first global trade reform in two decades but was blocked by India's demands for concessions on agricultural stockpiling. Here's a quick post that will tell you everything related to the WTO deal: - What is the deal? The deal, termed a trade facilitation agreement (TFA), aims at simplifying customs procedure, increasing transparency and reducing transactions cost. The TFA is the first major global trade reform pact in two decades. Estimates suggest the pact could add $1 trillion and 21 million jobs to the world economy. The deal was the first global trade pact reached by the WTO and was hailed as having restored credibility to the group and reviving the Doha Round of trade negotiations. - Why did it fail? India decided not to sign the protocol of the Trade Facilitation Agreement (TFA), concluded at the Bali ministerial conference of the WTO held in December last year. WTO ministers had already agreed the global reform of customs procedures during the Bali talks but were unable to overcome last minute Indian objections and get it into the WTO rule book by the July 31 deadline. - Why did India say no? India was trying to win guarantees to protect a $12 billion annual programme to feed its poor that risks breaking WTO rules on price support subsidies to farmers. India's new nationalist government has insisted that a permanent agreement on its subsidized food stockpiling must be in place at the same time as the trade facilitation deal, well ahead of a 2017 target set last December in Bali. The WTO Agreement on Agricultural (AoA) subsidies allows only 10 percent (of production) subsidy for most of the developing countries. Rich countries argued that the Food Security Bill exceeds this 10 percent and therefore it would "distort" international trade. India's position is getting support from countries including South Africa, Cuba, Venezuela and other emerging economies. - What's everyone saying? - "Failure to sign the Trade Facilitation Agreement sent a confusing signal and undermined the very image Prime Minister Modi is trying to send about India," a U.S. State Department official told reporters after Kerry's meeting with Modi. - "We have not been able to find a solution that would allow us to bridge that gap...Of course it is true that everything remains in play until midnight, but at present there is no workable solution on the table, and I have no indication that one will be forthcoming," WTO Director-General Roberto Azevedo said. - What now? Diplomats say India could technically attract a trade dispute if it caused the deal to collapse, although nobody wanted to threaten legal action at this stage. Other nations have begun bringing the rules into domestic law, and the WTO has set up a funding mechanism to assist. Some nations, including the United States, European Union, Australia, Japan and Norway, have already discussed a plan to exclude India from the agreement and push ahead, officials involved in the talks told news outlets. With inputs from agencies -- You received this message because you are subscribed to the Google Groups "Progressive interactions" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To post to this group, send email to [email protected]. Visit this group at http://groups.google.com/group/progressive-interactions. 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