The Hindu Business Line : WTO: Consensus draft framework still elusive

EVEN as the WTO members broadly hailed the first draft of a package of "framework" agreements when they met in Geneva on July 19-20, serious reservations still exist over some parts of the text, making the task of cobbling a consensus text a difficult exercise.

Official sources told Business Line here that senior officials of the trade policy division of the Ministry of Commerce and Industry headed by Special Secretary Mr S.M. Menon have been in Geneva to assist the Indian envoy to the WTO, Mr K.M. Chandrashekhar, in taking part in the deliberations of the various negotiating groups to evolve a final text framework map.

The General Council Chairperson, Mr Shotaro Oshimo, warned that the agreement would have to be hammered out by the "drop-dead" deadline of July 30. The WTO Director-General, Mr Supachai Panitchpakdi, also urged delegations not to make too many alterations at this stage, but to leave other concerns for the next phase of negotiations.

The sources said the Union Minister of Commerce and Industry, Mr Kamal Nath, is scheduled to reach Geneva by the weekend, once Parliament session goes for recess, to assist the Head of the Indian delegation and senior officials of his Ministry in helping to evolve a consensus draft framework.

Dr Supachai told the heads of delegation that the draft is not a final agreement of the Doha round, but the basis for continuing negotiations after July 2004.

WTO officials said that altogether about 50 delegations spoke at the informal heads of delegation meeting in Geneva and the areas of differences on key issues also surfaced. Thus, a number of major net importing countries took exception to the proposed ceilings on tariffs, cuts on tariffs on all products and expansions on all tariff quotas in the agriculture agreement. They also said the flexibility provided to protect their sensitive products to be insufficient. Also, a number of developing countries, including India, contended that the more specific "comfort" given to the richer countries for their sensitive products was not counterbalanced by the vaguer flexibilities to be given to developing countries.

While the agriculture negotiations chair Ambassador, Mr Tim Groser, had suggested that it would be more appropriate to negotiate the flexibilities for developing countries (under `special products' and `special safeguards mechanisms') after the developed countries' flexibilities had been settled, several developing countries said the two should not be linked.

There is also a division among the developing countries on the treatment for developing countries. A number of these particularly in Africa, the Caribbean and the Pacific remain strong advocates of special treatment, including exemptions and additional flexibilities for weaker and more vulnerable countries and measures to deal with the erosion of preferences (for instance, when duty-free access becomes less meaningful when the normal duty rate charged on imports from other countries is reduced), countries from Latin America and Asia are afraid that these proposals would create new categories of countries. The latter group also objects to preferences that are given only to selected group of countries.

Interestingly, several countries said that if they were to agree to significant reforms in agriculture, they would need significant improvements in market access for non-agricultural products and services, putting the developing countries into a sort of quandary as to how to accede to this type of import binge.

While on the Singapore issues (investment, competition policy and transparency in government procurement) there was still some discussion of whether these should be dropped completely from the WTO or only from negotiations under the Doha Development Agenda. However, even on trade facilitation, in which a majority of countries appeared to have agreed to include for evolving framework negotiations, questions were raised as to whether flexibilities (for instance, where developing countries' obligations would be related to their capacities) would shield them from possible dispute proceedings in the WTO; and how firm the commitments on technical assistance would be.

With this differences still haunting the heads of delegations and with the deadline looming large, building a consensus draft framework acceptable to all would demand positive response from political leaders throughout the WTO membership for agreeing on a July-package that re-energises the Doha Development Agenda.