Tuesday, September 29, 2020
Home Opinions Paradigm Shift at Nairobi WTO Ministerial Talks

Paradigm Shift at Nairobi WTO Ministerial Talks

Trade Ministers from 162 countries of the World have assembled at Kenyan capital Nairobi, between Dec 15-18 to arrive at a consensus on liberalizing trade and give final push to the Doha Development Agenda (DDA) which was stalled since 2001. The special focus for the 10th WTO Ministerial conference at the Kenyatta International Convention Centre was agriculture, services and industrial tariff. This year marks the 20th anniversary of WTO (World Trade Organization), created under the Marrakesh Treaty replacing the General Agreement on Tariffs and Trade (GATT). GATT came into existence after World War II along with Bretton Woods Institutions of World Bank, IMF and ITO (International Trade Organization). ITO, initially created to address trade related issues, employment, investment and commodity agreements as an allied agency of UN couldn’t be rolled out as US didn’t approve it. In absence of an international organization for trade, GATT took over the trade till an institutional mechanism came into force. WTO is an intergovernmental organization that control the international trade by providing a framework for negotiating trade agreements, resolving disputes and enforcing the adherence to WTO agreements by member countries.

Under WTO’s predecessor GATT, seven rounds of negotiations occurred. Ministerial conferences, which meet once in two years are the highest level decision making body of WTO. The fourth ministerial conference held in Doha in 2001 had an ambitious agenda of increasing global trade by lowering the trade barriers through slashing subsidies. Termed as the Doha Development Round or the Doha Development Agenda, it was congruent with growth aspirations of the developing countries. The Doha agenda included two declarations- first one included negotiations on agriculture and services- referred to as Doha Development Round. Second agenda included industrial tariffs, changes to WTO rules, aspects related to developing countries and an agreement on Trade- Related Aspects of Intellectual Property Rights (TRIPS). Doha declaration called for phasing out all forms of export subsidies, and “substantial reductions in trade-distorting domestic support”. It provided special and differential treatment for developing countries. Domestic support, export subsidies and market aspects became key pillars for agriculture negotiations. China has become member of WTO during Doha conference where the implementation of patent systems in Least Developed Countries (LDC) is deferred by 2016.

Following the stalemate of the Doha talks, subsequent rounds held in Cancun (2003), Hong Kong (2005) aggressively pursued the agenda but the developed countries led by EU, US and Japan and developing nations under India, Brazil, China and South Africa failed to arrive at conclusion of negotiations by the first deadline, January 2005. Negotiations were stalled after breakdown in 2008 over disagreements in agriculture, industrial tariffs, non-tariff barriers, services and trade remedies. In the meanwhile, India was repeatedly blamed for breakdown of negotiations but 100 countries supported India’s claims that livelihoods of farmers would be at stake if the threshold of Special Safeguard Mechanism (SSM), was high. SSM is a measure that allows countries to protect the interests of domestic farmers by imposing import tariff on agriculture goods in case of price fall or import surge. Besides, a study by University of Michigan indicated that if trade barriers in services, agriculture and manufactured goods are reduced by 33% as per DDA, global welfare would increase by $574 billion (1). But following disagreements over the Doha talks, countries are now entering into agreements in smaller groups. Thus recently the groups like Trans Pacific Partnership (TPP) (nearly finalized), Trans- Atlantic Trade and Investment Partnership (TTIP) and Regional Comprehensive Economic Partnership (RCEP) are actively working to recalibrate the existing trade practices to accrue financial benefits.

For the past several years, WTO is witnessing huge rift between the developed and developing countries over the DDA, wherein developed countries led by the US are keen on foregoing the DDA and rallied for more market access for their domestic producers. India, China and South Africa has been vocal about special and differential treatment for developing countries.

While current talks at Nairobi failed to evolve at a consensus, India managed to obtain Special Safeguard Mechanism (SSM) to protect interests of poor farmers of developing countries and affirmation from member countries to work towards permanent solution for stockholding food grains. SSM facilitates India to scale-up tariff barriers to protect the small and marginal farmers. Developed countries raised the bar of imposing SSM, by contending that it can introduced when agricultural imports crosses 40% in a sustained manner. India, insisted on using SSM when imports raise by 10%. Earlier at Bali, India despite stiff opposition from the US managed to obtain a right to hold huge amounts of food stocks in exchange for its support to the World Trade Facilitation Agreement (TFA). Public stock holding for food security is vital for developing countries like India (2).

The reaffirmation of the DDA rallied by New Delhi failed to find a place in the Nairobi Ministerial Declaration (NMD) or the Nairobi Package finalized after hectic negotiations for five days. Significantly, while the DDA agenda was literally buried, new issues were identified for discussions. The final draft, largely an outcome of series of negotiations carried out by the US, EU, China, India and Brazil mirrored the demands of US and conveniently avoided reaffirmation of DDA. Ironically the twitter hashtag #IndiablocksWTO was trending throughout entire duration of the meetings, implicating India for blocking the negotiations, while the dubious propaganda was indeed launched by the west on the social media.

In a marked departure from the “consensus-based decisions” the voices of developing countries like India, China, G-33, Least developed Countries (LDC), African Group and the ACP groups (African, Caribbean and Pacific) were largely ignored for the first time at the Nairobi talks. Developed countries hailed the Nairobi package who argued that in the 20 years history of WTO Doha talks significantly consumed 14 years and still negotiations over DDA couldn’t be concluded successfully. At Nairobi, developed countries have agreed for ban on export subsidies immediately while developing countries must follow by 2018 and global trade on IT products was liberalized. Developing countries can support transport and marketing costs of agricultural exports till 2023. Poorest countries are bestowed with more concessions and products coming from sub-Saharan region are given preferential treatment in the global markets. WTO has struck Information Technology Agreement in July 2015 to cut tariffs on $1.3 trillion worth of technology products (on nearly 200 products) (3). This move will indeed boost the manufacturers of various IT products like video games. Computer chips, GPS devices, medical equipment, printer cartridges etc., creates more jobs boosting the economy. Developed countries opined that removing export subsidies will help the farmers of poor countries to compete fairly. But Indian civil society was deeply disappointed as eliminating export subsidies might aggravate the crisis of sugarcane farmers. They opined that Nairobi talks spelt death knell for Indian agriculture and that New Delhi has meekly surrendered at Bali without getting much in return. At Nairobi, Afghanistan and Liberia joined the WTO taking the tally to 164 countries.

Economic crisis of 2008 has impacted all global economies and most of them failed to recover yet. By and large developed countries having lost their patience, have decided not to let the niceties for developing countries plague the agenda of the WTO talks, have  collectively opposed negotiations on Doha agenda. Developed countries battling under recession now want emerging economies to open up their agriculture, services and manufacturing sector. But intriguingly, market access to developed countries is not fully resolved. Besides, EU has been forcing India to impose cuts on the farm subsidies while they (EU&US) remained deeply uncommitted about their own agriculture subsidies.

But in any case, India’s agricultural subsidies are proving to be largely inefficient and unsustainable over a period of time. It is time to reform the agriculture subsidy system in India by moving onto direct cash transfer which is more effective and WTO-compliant. Further this will reduce burden on country’s exchequer even. Moreover, with economies largely aligning themselves into regional trade agreements, India can no longer afford to evolve a system wherein Indian markets and domestic producers can remain uncompetitive in the global market. With emergence of mega-trade blocks at faster pace, India might be forced to bring about changes in its IPR laws even.



  1. http://fordschool.umich.edu/rsie/workingpapers/Papers476-500/r489.pdf
  2. http://indianexpress.com/article/opinion/editorials/doha-development-round-world-trade-organization/
  3. http://www.bbc.com/news/business-33647358

  Support Us  

Whether NDTV or 'The Wire', they never have to worry about funds. In name of saving democracy, they get money from various sources. We need your support to fight them. Please contribute whatever you can afford

Related Articles

Trending now

Delhi Riots Conspiracy Chargesheet Part 1: Yogendra Yadav, Umar Khalid, Sharjeel Imam, seeds of anarchy laid on 5th and the violence on 13th Dec

7 months after the gruesome riots, the Delhi police has filed the first chargesheet detailing the conspiracy that was hatched to unleash violence in the streets of Delhi.

From “Khoon ki Dalali” to “where is proof”: How opposition parties questioned India’s 2016 Surgical Strikes in Pakistan Occupied Kashmir

The elite commandos of Parachute regiment on the intervening night of September 29-30 carried out an attack with clinical precision deep inside the Pakistan Occupied Kashmir, destroying 7 terror launch pads

Propaganda War: The undue influence of the Chinese govt over Indian media is a matter of deep concern and requires urgent intervention

Chinese Communist Party has sought to influence individual journalists and media organisations in its bid to alter global perception about China.

PM Modi tears into Congress and others for opposing farm bills, shows how they opposed everything from Ram Mandir to Rafale

PM Modi said that the people opposing the Farm Bill are doing so because the new reforms will finish the source of their black money.

AIIMS report does not rule out murder angle in Sushant Singh Rajput’s death, CBI to begin second leg of investigation soon: Reports

Since most of the evidence was destroyed, the findings has been based on 20% viscera samples of Sushant Singh Rajput

Recently Popular

Sanatana Dharma vs Bollywood on Republic Bharat: Arnab Goswami goes to war

Arnab Goswami has been at the forefront of the campaign against the drag racket in Bollywood and has not pulled any punches.

‘Maal is cigarette and hash are its different brands’, Deepika Padukone makes bizarre claims when confronted with ‘drug’ chats: Report

Deepika Padukone and others were apprised in advance as to what needed to be said during the interrogation, claimed NCB

“Your time of death has come”, radical Islamists attack actress-politician Nusrat Jahan on social media after she poses as Goddess Durga

An Instagram user, Sagar Hossain, questioned Nusrat Jahan, "Why do you support Hindus despite being a Muslim?"

Argentina: Legislator kisses bare breast of his girlfriend during online parliament session, resigns after the video goes viral

Juan Emilio Ameri claimed that he assumed that the camera was off and wanted to check out his girlfriend's new breast implants

Amnesty International, which had links to British govt and Islamist orgs shuts shop in India after it says the govt froze all its accounts:...

The government of India has stated that Amnesty has been receiving foreign funding and donations despite not registering under FCRA.

After Sushant Singh Rajput, another budding Bollywood actor from Bihar found dead, family alleges Mumbai police not cooperating

Akshat Utkarsh, hailing from Sikanderpur in Bihar's Muzaffarpur, was found dead under mysterious circumstances in Mumbai.

MP Forest Department initiates Elephant Adoption Scheme at Bandhavgarh Tiger Reserve for adoption of old and retired elephants

Week-long Hathi Mahotsav began in the Bandhavgarh Tiger Reserve on Monday this week during which the elephants in the Reserve will be given a break and will be served.

Denmark Ambassador to India calls out The Hindu for spreading fake news regarding comment by Danish PM over COVID-19 in India

Ambassador of Denmark to India, Freddy Svane, has called a report by The Hindu "twisted news".

Watch: TMC leaders and cadres in West Bengal protest Farm Bills with DJ, dance, gun and blood

With the Durga puja fever setting in TMC cadres were seen dancing and singing as they protested against the farmers bills

All you need to know about the Hathras gang rape case

Dispelling the news on social media, the Hathras police said that victim’s tongue was not cut off but injured.

‘The law applies equally to all and it shall apply to Amnesty International as well,’ MHA gives the dubious NGO a royal dressing down....

Amnesty International had accused the central govt of a witch-hunt against it blaiming them for its decision to wrap up

Delhi Riots Conspiracy Chargesheet Part 1: Yogendra Yadav, Umar Khalid, Sharjeel Imam, seeds of anarchy laid on 5th and the violence on 13th Dec

7 months after the gruesome riots, the Delhi police has filed the first chargesheet detailing the conspiracy that was hatched to unleash violence in the streets of Delhi.

Fact Check: Was Amnesty International forced to shut its operations in India due to its report on the Delhi Riots?

Amnesty International, one of the shadiest non-governmental organisations, was forced to shut down its operations in India on Tuesday

India-China standoff: MEA spokesperson rejects Chinese stand on Line of Actual Control. Read details

MEA spokesperson Anurag Srivastava has stated that the comments by the Chinese Foreign Ministry on the existence of 'only one LAC' ran counter to the bilateral agreements between the two sides.

Fact Check: Did a Muslim lawyer represent Bhagat Singh and a ‘Brahmin RSS’ man fought for the British against him?

Many social media posts and forwards are claiming that a 'Brahmin' RSS lawyer had fought for the British against Bhagat Singh.

From “Khoon ki Dalali” to “where is proof”: How opposition parties questioned India’s 2016 Surgical Strikes in Pakistan Occupied Kashmir

The elite commandos of Parachute regiment on the intervening night of September 29-30 carried out an attack with clinical precision deep inside the Pakistan Occupied Kashmir, destroying 7 terror launch pads

Connect with us