The collapse of the talks at Potsdam, Germany brings to an end the efforts of the G-4 - the European Union, the United States, India and Brazil - to reach some kind of consensus on the Doha round of the World Trade Organization (WTO).
On his return from the failed talks on Friday, Kamal Nath, commerce and industries minister, emphasised that there could be no compromise on the issue of agriculture market access. "There was no question of any compromise on agricultural market access issues, which would have affected our farmers adversely," he stated.
Nath also warned the developed countries against any effort to break the existing unity of the developing countries.
To queries about the fate of G-4, the minister said, "It is the end of road for G-4. We have tried but we have not succeeded in resolving the contentious issues. The multilateral rule based talks will continue. Now it is for the full membership of WTO to decide."
Asked whether the G-4 deadline of completing the Doha round by the end of the year would be met, he said, "I am an optimist, but also a realist. Developed countries have to resolve the issues. Content is more important than deadline."
Trade officials, however, admitted that the G-4 deadline is likely to be missed. "It is difficult to achieve the deadline. We may need a miracle to achieve the target date," an official said.
Nath said that developed countries wanted greater access to the markets of the developing world but refused to cut their trade distorting subsidies in agriculture. He said the Swiff coefficients formula proposed for non-agricultural product would have resulted in developed countries taking average tariff cuts in their industrial products of just over 30 per cent, while developing countries would have to reduce their tariffs by more than 60 per cent on an average.
"This could only have helped the developed countries to make heavy inroads into the markets of developing countries, while offering negligible reciprocal gains to the latter. It also held out the spectre of deindustrialisation of the developing countries along with a reduction of foreign direct flows into them," he pointed out.