Written by Olivia Le Poidevin
GENEVA (Reuters) – Major differences remain between most countries and the United States and India as trade ministers meet to discuss reforms at the World Trade Organization, two diplomats told Reuters on Friday.
The ministers meet for four days in Yaoundé, Cameroon, as the organization faces a critical test of its future amid a year of trade disruptions caused by tariffs and widespread disruption to shipping, energy prices and supply chains due to conflict in the Middle East.
“There is a real commitment among ministers to reach an agreement on reforms, but there is a big elephant blocking the room: India and the United States,” a senior diplomat told Reuters.
Another diplomat from an African country said that India has so far shown no signs of changing its position. However, it may be possible to achieve some flexibility. “We have a lot of hope in the hallways,” that person said.
The diplomats refused to reveal their names due to the sensitivity of the ongoing negotiations.
Although the United States and India recognize the need to reform the global trading system, they have resisted proposals for a substantive action plan on reforms.
“Unfortunately, with regard to reform, I do not see much room for maneuver between the positions of the United States and India,” the senior diplomat said.
India also opposed an agreement to aid investment in developing countries, as well as a US proposal to permanently extend the e-commerce moratorium on tariffs on electronic transmissions such as digital downloads, which expires this month.
“The positions of the US, China, the EU and the UK are reasonable, but there is one party from which we need to see compromise to achieve progress, and that is India,” said Chris Southworth, Secretary General of the UK International Chamber of Commerce.
“I think frustration among members will start to spread here in Yaoundé if we don’t see any progress,” he said.
India’s position
Indian Commerce and Industry Minister Piyush Goyal questioned US efforts to extend the e-commerce moratorium, saying it required “careful reconsideration.” India is concerned about the loss of tariff revenue.
US Trade Representative Jamison Greer said on Thursday that Washington was “not interested” in a temporary extension of the ban, only a permanent extension.
Goyal also challenged moves by the European Union, the United States, Canada and others for a subset of members to make their own decisions through multilateral agreements, saying any outcome must be agreed unanimously.
This has cast a shadow over whether the Investment Facilitation for Development Agreement to encourage foreign direct investment in developing and least developed countries could be included in the WTO rulebook in Yaounde. On Thursday, Türkiye lifted its opposition to it.
Ajay Srivastava, founder of the Delhi-based Global Trade Research Initiative and a former Indian negotiator, told Reuters that Goyal’s stance showed that India was seeking to protect the basic structure of the WTO.
“Taken together, these risks threaten to transform the World Trade Organization from a rules-based body into a body driven by power and selective alliances,” he said.
There is also an impasse in the World Trade Organization on one of New Delhi’s key priorities: reaching a permanent solution on holding public stocks to allow developing countries to provide subsidies to rice and wheat farmers through the price support mechanism.
Major agricultural exporters, such as the United States, the European Union and Australia, fear that this will allow countries such as India to build up large food stocks and dispose of surpluses, which could distort trade and markets.
Randa Sengupta, a senior researcher at the Third World Network think tank, said public health services are an important way to support farmers and enable food security for poor communities in India.
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