The Telegraph
Since 1st March, 1999
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The Cancun “failure” is subject to various interpretations. The general impression in India is that the commerce ministry scored a great victory. Other than the developing-country coalition on Singapore issues being spearheaded by Malaysia and the one on agriculture by Brazil, what is great about no agreement' As long as India faces no import threat on agro-items, and investment is kept out, India has a vested interest in strengthening the multilateral process. The United States of America’s trade representative has threatened recourse to bilateral free-trade agreements, and the European Union also has FTAs up its sleeve. Barring the south Asia preferential trading arrangement, India has no FTAs. Negotiations with the Association of Southeast Asian Nations and the EU are in early stages. The spectre of FTAs need not be blown up. Such concerns also surfaced when the Uruguay Round was seemingly stuck in Montreal in 1988 and in Brussels in 1990. Despite FTAs, the multilateral system survived and rather paradoxically, with the Uruguay Round coming to a successful conclusion and the World Trade Organization materializing, the number of FTAs has increased. But India’s stake in the multilateral system cannot be discounted. Even if bilateral agreements with several countries were possible, the transaction costs would be considerable.

Media reports suggest that the US trade representative badly wants the Doha development agenda to be successfully concluded by January 2005, given the US elections. So do Mr Pascal Lamy and Mr Supachai Panitchpakdi, since their terms are almost over and they would like to end on a successful note. While these may be valid arguments, the negative inference that India does not need a successful DDA is false. If reports are to be believed, the WTO came close to a satisfactory agreement on September 14, before smaller countries torpedoed the process. The diabolical hypothesis of the US trade representative having triggered this failure because the Americans do not want to reform cotton subsidies may or may not be true. However, did India do enough to keep smaller countries in the loop or were Indian energies solely targeted towards the likes of South Africa, China, Brazil and Malaysia' As a responsible country, which is what Mr Arun Jaitley wants India to be projected as, what are India’s suggestions about improving the WTO decision-making processes' While these do need to become more transparent and democratic, is there a credible alternative to the much-maligned Green Rooms' Is any outcome possible if 148 members have to unanimously agree'

Mr Lamy may exaggerate when he says that the WTO will degenerate into another United Nations. But answers have to be found and India cannot afford to pass the buck to the US and the EU. Without such answers, resumption of talks in Geneva in December will not make much headway. Hence, the blame game makes things dysfunctional, as does the premature victory dance. The commerce minister said in Cancun that a good agreement is preferable to none, and no agreement is preferable to a bad one. Why has the first part been forgotten back home in India'

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