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Developed nations behind WTO deadlock: Nath

India says developed countries are trying to go back on their commitment on the development content of Doha round of WTO talks.

business Updated: May 04, 2007 16:06 IST

India has said that developed countries were trying to go back on their commitment on the development content of Doha round of WTO talks and are putting new conditions on developing countries leading to a deadlock in negotiations.

"The current freeze we are witnessing is because the debate is being deflected from an unconditional delivery of the development dimension to conditionalities that expose what seem to be the real intention of some," Commerce and Industry Minister Kamal Nath in his address at Oxford University's Said Business School.

"We have engaged in this round in the belief that it is a development round. And we aim to continue to proceed on that premise," said Nath, who is championing the cause of the developing countries at the WTO talks.

High subsidy given by developed countries and industrial tariffs has been the most contentious issue at WTO talks since the Doha Development Round was launched in the Qatari capital in 2001.

Representatives of four key WTO players - India, the US, Brazil and the European Union, held a meeting in New Delhi in mid-April but failed to reach an agreement.

The representatives are expected to meet again on May 17-18 in Paris. Nath spoke at length on the rapid growth India has been registering during the last few years and himself posed the question "what has all this got to do with the WTO? If India is doing so well, then why is it perceived as being difficult in the negotiations?"

There are many realities that co-exist in India. "Just because Indian industry has matured to the extent of aggressively pursuing acquisitions abroad, and we are witnessing an outward flow of FDI, does not mean that we have reached first world status."

Sixty per cent of India's people are dependent upon agriculture for their livelihoods. Indian agriculture is characterised by small holdings of less than five acres.

"In spite of this, the Indian farmer is willing to compete with the American farmer. But can he compete with the US Treasury? Can we allow what has happened to West Africa, to happen to our farmers?" the minister questioned.

He cited the example of the unfair cotton trade with African countries.

"Whole populations of five nations in West Africa have been reduced to abject poverty through unfair trade. And we are still negotiating about it," he said.

Nath said: "Tariffs are legitimate economic instruments. Subsidies, on the other hand, are not. How fair is it to 'trade off' legitimate instruments against illegitimate ones?"

"Even the window of Special Products and the Special Safeguard Mechanism that was devised in the July Framework as a means of safeguarding livelihood security and rural development needs is being sought to be tied up in knots so as to render it ineffective."

First Published: May 04, 2007 16:02 IST