WTO Presentation

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WTO-AoA NEGOTIATIONS STATE OF PLAY
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GENESIS

• WTO Came into existence on 1-1-1995 with the
  conclusion of Uruguay Round Multilateral Trade
  Negotiations at Marrakesh on 15th April 1994, to
  
• Provide common institutional framework for
  conduct of trade relations among members
• Facilitate the implementation, administration and
  operation of Multilateral Trade Agreements
• Lay down Rules and Procedures Governing Dispute
  Settlement
• Provide Trade Policy Review Mechanism

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Agreement on Agriculture (AoA)

• To establish a fair and market oriented
  agricultural trading system through substantial
  progressive reduction in agricultural support and
  protection resulting in correcting and preventing
  restrictions and distortions in world
  agricultural markets.

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AREAS OF COMMITMENTS

• Domestic Support i.e. subsidies by
  Governments to domestic producers

• Market Access i.e. the disciplines on import
  restraints and tariffs and

• Export Competition i.e. export subsidies and
  other forms of export subsidisation.

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Domestic Support

• Green Box - Research, Extension, PDS,
  Decoupled Payments
  etc
• Blue Box - Production Limiting Subsidies
• Amber Box - AMS-subject to reduction
  commitments viz
• - Product specific (MSP)
• - Non product specific (input subsidies-fert.
  Power,
• irrigation)
• Total Agricultural support reduction (Base
  period 1986-88)
• Developed countries 20 (1995 - 2000)
  
• Developing countries 14 (1995 - 2004)
  
• De-minimis level
• Developed countries 5
• Developing countries 10 .

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Market Access

• All non-tariff barriers including, Quantitative
  Restrictions to be abolished

• Tariff cut Commitments
• Developed countries - Average 36
  - Minimum 15 (1995
  - 2000)
• Developing countries - Average 24
  - Minimum 10
  (1995 - 2004)

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IMPACT ON INDIA (Market Access)

• Bound tariff levels for India
• Primary products 100 Processed products
  150 Edible oils 300
• (Some exceptions (119 items) are governed by
  other provisions of GATT Art.II 1(b).

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Export Subsidies

• Cut in value of subsidies
• Developed countries - 36 (1995 - 2000)
• Developing countries - 24 (1995 - 2004)

• Cut in subsidised quantities
• Developed countries - 21 (1995 - 2000)
• Developing countries - 14 (1995 - 2004)
• (Base Period (1986 - 1990)
• To develop internationally agreed
  disciplines to govern
• export credits, guarantees or insurance
  programmes.

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Doha Ministerial Conference
Fourth Ministerial Conference on WTO was held at
Doha, Qatar from 9-13th November 2001 This
conference, inter alia, reviewed the progress of
AoA negotiations and provide guidelines for
future. The Ministers at Doha committed
themselves to negotiation aimed at substantial
improvement in market access, substantial
reduction in trade distorting domestic support
and gradual phasing out of export subsidies.
The special and differential treatment - an
integral part of the mandated agricultural
negotiations.
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India Seeks

• Protecting our food and livelihood security by
  having sufficient flexibility for domestic policy
  measures.
• Protecting domestic producers from the surge in
  imports or significant decline in import prices.
• Substantial reduction in export subsidies and
  domestic support to agriculture in the developed
  countries for greater market access to products
  of developing countries.
• Finally, a more equitable fair trading
  framework for
• agricultural commodities
• MARKET ACCESS ISSUES CAN NOT BE SEEN IN ISOLATION
  TO SUBSIDY REGIME

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Present Stage of Negotiations

• The third phase of negotiations ended in
  March-2003.
• As per original schedule, the modality of the
  Agreement were to be established by 31.03.2003.
• The deadline for establishment of Modality has
  been missed
• In the last one year a number of drafts for
  establishment of Modality have been proposed
• The major drafts include, Harbinsons original
  and revised draft, US-EU combined draft, Original
  Cancun Draft and the Derbez Text (Cancun revised
  draft )

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Present Stage of Negotiations

• The Cancun Ministerial failed to arrive at any
  agreement on modality for agriculture.
• There was no willingness on part of developed
  countries to recognize the genuine concerns of
  the developing countries, especially in
  agriculture
• The US EU attempted to drive their own agenda,
  at the expense of Doha Declaration
• The concerns of the developing countries were
  expressed by a group viz. G-20 at Cancun.
• India, China, Brazil, Argentina and South Africa
  were the moving spirits behind the formation of
  this Group.

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Present Stage of Negotiations

• Some of important features of the two Harbinson
  Drafts are as follows
• Includes the crucial numbers. Framework proposes
  modalities.
• Tariff reduction higher than Uruguay Round, using
  the concept of average and minimal reductions
  based on tariff bands.
• Introduction of a new concept of Special Products
  for developing countries, average tariff
  reduction on SP to be at 10, and minimum
  reduction, 5.
• Introduction of Safeguard Mechanism for
  developing countries.

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Present Stage of Negotiations

• Reduction mainly in the amber box support by
  developed countries.
• Reduction in the De-minimis support for
  developed countries
• Proposals only to discipline the Blue Box
  payments, no reduction.
• Proposals to tighten the criteria for Green Box
  payments for developed countries, expansion of
  Green Box for developing countries
• Elimination of direct export subsidies over a
  longer period. Indirect subsidies no final
  proposal

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Present Stage of Negotiations

• The SD for the developing countries remains on
  the lines as Uruguay Round.
• The SD for developing countries include, a
  marginally lower rate of tariff reduction, a
  longer implementation period, provision of
  Special Products with lower tariff reduction,
  provision of Safe guard mechanism, retention of
  provisions at para 6.2 of the present AoA, with
  possible widening and retention of de-minimus in
  Amber Box Support

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Present Stage of Negotiations

• The US-EU draft, and the two Cancun drafts are
  similar in nature and their main features are
• The drafts propose only a framework. They dont
  indicate the key numbers
• Aggressive reductions in tariff by using a hybrid
  formula. Swiss formula to be a component of the
  hybrid formula
• Reduction for developing countries also to be by
  same formula, with lower final commitment.
• SPs to be limited in numbers.

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Present Stage of Negotiations

• Reduction mainly in the amber box support by
  developed countries.
• Reduction in the De-minimis support for
  developed countries.
• Capping of product specific support in Amber Box
• Expansion of Blue box by inclusion of direct
  payments.
• Capping of the expenditure under new Blue Box,
  with a possible phased reduction over the
  implementation period.
• No reduction in Green Box payments. The criteria
  for Green Box payments may possibly be reviewed.
• Reduction commitments for developing countries
  lower with longer implementation period.

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Present Stage of Negotiations

• The provisions of Article 6.2 to be continued.
• The de-minimus for the developing countries to be
  retained at 10.
• Elimination of export subsidies over an extended
  period during the implementation period.
• The trade distorting elements of export credit to
  be similarly treated.
• No specific timeframe for elimination suggested.

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Indias stand on various drafts

• The drafts fail to recognize the inter-linkages
  in the three pillars of AoA.
• The reductions suggested in domestic support are
  minimal, as compared to the steep reduction in
  tariff included in the Draft.
• The drafts fail to recognize the food security
  and livelihood concerns of the developing
  countries.
• The drafts are not meeting the spirit of Doha
  Development Agenda.

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Developments Post-Cancun Ministerial

• The G-20 has survived the pressures of the
  developed countries and almost remained united on
  agriculture issues.
• The Cancun process led to loss of confidence of
  developing countries in the developed countries.
• The negotiations have formally not yet started at
  Geneva.
• The stress, at present is more on arriving at
  bilateral understandings.
• G-20 had bi-laterals with EU, one in Brazil and
  other in Geneva.
• India has had separate bilateral discussions with
  USA as well as EU.

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Thank You