The Hindu Business Line : Round and round

ALL INDICATIONS POINT to a bleak outlook for the ongoing Doha Round of multilateral negotiations. The strongest confirmation of this came at the Davos World Economic Forum where the World Trade Organisation Director-General, Mr Supachai Panitchpakdi, said he was not at all happy with the pace of the negotiations to get the Doha Round into the implementation stage by 2006. Things, he said, had not moved far enough "to guarantee that Hong Kong will be the penultimate step to complete the round" by next year. In fact, the road immediately ahead is so uncertain that the WTO chief admitted that he could say nothing about "how much we hope to achieve" by the time the Hong Kong ministerial is held from December 13 to 18.

It is against this discouraging backdrop that the Commerce Minister, Mr Kamal Nath, is leading an initiative to arrive at a consensus of sorts on trade negotiations among the important players, mainly from the poor countries. Thus, New Delhi will be hosting two important meetings of two crucial groups (the G-20 and G-33) to bring some agreement on the stand of the developing world on such areas as agriculture, non-farm market access, special products, special safeguard mechanism, and so on. It may be unfair to prejudge the outcome of the two meetings, but it would be safe to suggest that not much will be accomplished because of the well-entrenched positions of the principal players.

Some idea of the latest position of the main players in the Doha Round negotiations can be had from the views expressed at the January 29 informal meeting of around 25 WTO members held on the sidelines of the WEF meeting. The objective of the gathering — attended among others by the US, the EU, India, China, Brazil, Canada and Australia — was "not to make specific suggestions but rather to demonstrate that members have the political will to bring the round to conclusion". Of course there was agreement on what to focus on — the modalities for agriculture, a formula for reducing tariffs on industrial goods, market-opening offers in talks on services, and so on — but, substantively, there was hardly any progress in that "very different views" were reported on what is "necessary to move the talks forward".

Thus, the EU Trade Commissioner, Mr Peter Mandelson, harped that it was up to developing countries such as India, China and Brazil to do their bit by lowering tariffs on industrial goods and offering special market access to less-developed countries (LDCs) after Brussels had taken the initiative to eliminate farm export subsidies. But Mr Kamal Nath rightly riposted that ending farm export subsidies was not enough to free trade in farm goods and that India was more interested in a "formula" for pruning tariffs on industrial goods "before negotiating liberalisation sector by sector". He also underscored the point (considering India's interests) that talks on services needed as much attention as those on agriculture and industry. There is little possibility that these differences will be settled by an informal August deadline, though essential if the larger 2006 target for the Doha Round is to be met.

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