Diplomatic negotiations don’t generally make for white-knuckle narratives, but the World Trade Organisation (WTO) talks at Bali have come close to it over the past few days. The positive outcome — at the 11th hour, after it seemed the talks were going to fall through because of Commerce Minister Anand Sharma’s refusal to back down on the food security issue — is about as good as it possibly could have been for India.
Indian negotiators have earned a reputation in various international forums as tough, shrewd customers; they proved it here by winning the concession they wanted. It was a necessary one. The terms as they stood going into Bali — capping food subsidy at 10 per cent of the value of production — were unacceptable. Not just India, food security issues affect other developing nations as well as they might look at similar initiatives like the Food Security Bill to tackle the global south problem of widespread poverty and hunger.
The ‘peace clause’ compromise that was on the table — holding all penalties from breaching the 10 per cent cap for the next four years in abeyance while a permanent solution was found — was so much hokum. Given that the Doha Development Round started in 2001 and only now was able to achieve anything, there was precious little chance of any solution to such a vexed issue being found in four years — and India, by conceding the point in principle, would have drastically undercut its space to manoeuvre at that point.
That process of negotiation and what it implies is perhaps the primary takeaway from Bali, not the specifics of the final agreement. Certainly, the coming to terms on the food security issue and the agreement on trade facilitation via simplifying customs procedures at borders — potentially benefiting Indian exporters and boosting trade flows globally — have kept the Doha round alive.
But it is on life support at best, far from being resuscitated. The WTO’s structural inequities, underscored this time around by the standoff, lie at the heart of that. As Olivier De Schutter, UN Special Rapporteur on the Right to Food pointed out, the same developed countries that were pushing for the food subsidy cap subsidise their farmers for more than $400 billion annually within the WTO framework.
Given the lack of progress in addressing these inequities, it is difficult to hold out much optimism for the Doha round. And the way in which erstwhile allies like China and Brazil split from India’s position highlights the differing agendas and various fault lines. Little wonder that the temptation for various countries to focus instead on bilateral and regional pacts is increasing. That would be poor compensation for the benefits the WTO can bring, of course — but for the latter to happen, a great deal more of hard bargaining will be needed to put developing nations’ concerns front and centre.