CAUGHT IN A WEB

New Delhi, Nov. 10: The US is likely to put pressure on G-20 to reduce tariffs on industrial goods.

Trade ministers from G-20, a group of developing countries, will be meeting in Geneva next week to discuss how best to negotiate this pressure and formulate a future strategy.

The US is slated to hold its presidential elections next year. Officials said Washington would try to put pressure on G-20 to complete the modalities for concluding the Doha round by the end of this year or early next year, before the polls.

While the developed countries, led by the US, want developing nations to cut tariffs on industrial goods, G-20 is demanding that rich nations should substantially reduce farm subsidies.

“The deadlock is unlikely to be resolved quickly as the G-20 nations are expected to maintain their stance on farm subsidy since it involves the livelihood of millions of people,” officials said.

Though the group is named G-20, it has 23 members — India, Brazil, South Africa, China, Argentina, Bolivia, Chile, Cuba, Equador, Guatemala, Indonesia, Mexico, Nigeria, Pakistan, Paraguay, Peru, the Philippines, Tanzania, Thailand, Uruguay, Venezuela and Zimbabwe. The group will be meeting in Geneva on November 15 and 16.

Officials said India had proposed that both developed and developing countries of the WTO should reduce tariff on industrial goods by at least half.

This will require developed countries to lower their tariffs to about 2.9 per cent, while India will have to reduce the average bound rates to 18-20 per cent.

However, the US and the European Union (EU) have not yet agreed to make substantial cuts in their farm subsidies.

There are also sharp differences over the extent to which the developing countries should reduce their industrial tariffs, although India has proposed a substantial cut.

The WTO negotiators proposed that the EU, the world’s biggest agricultural importer, should cut its highest tariffs by as much as 73 per cent and eliminate the use of subsidised exports by 2013. The 27-nation EU offered a maximum tariff cut of 70 per cent.

The WTO talks are stalled because of a lack of consensus between the developed and developing countries on the issues of market access and agricultural subsidies.

The G-20 nations have maintained that since Doha was a “development round”, it should result in significant gains for the poor.