India to object to China’s push to investments as trade issue at WTO | Latest News India - Hindustan Times
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India to object to China’s push to investments as trade issue at WTO

ByRajeev Jayaswal, New Delhi
Feb 21, 2024 08:02 AM IST

India will oppose a move by a China-led group to push investment agenda as a trade issue at the World Trade Organisation (WTO), ask discontinuation of customs duty moratorium on e-commerce trade and support domestic regulations on services.

India will oppose a move by a China-led group to push investment agenda as a trade issue at the World Trade Organisation (WTO), ask discontinuation of customs duty moratorium on e-commerce trade and support domestic regulations on services that will facilitate movement of professionals across member countries through a uniform process of recognising qualifications for various services, three officials aware of the development said.

A WTO document also mentioned about the oppositions to IFD proposals at the special general council on February 14. (Reuters)
A WTO document also mentioned about the oppositions to IFD proposals at the special general council on February 14. (Reuters)

A group of members unilaterally initiated a joint statement initiative (JSI) on investment facilitation for development (IFD), and its text has been pushed at the 13th ministerial (MC13) starting from next week in Abu Dhabi, which India will not support, they said, requesting anonymity. “We do not want to recognise the practice of pushing agenda through JSIs. Such moves dilute the multilateral character of the WTO,” one of them said.

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“As JSIs are unilateral attempts of certain countries to influence multilateral body, India oppose such unilateral moves, besides the agreement is not a legal document unless approved by all ministers,” he said, adding that investment should not be considered as a trade issue.

MC is the highest decision-making body of the WTO, where decisions are unanimous. The IFD agenda, pushed by China, initially had 70 members in 2017, which has now swelled to 123. Besides India, the US and South Africa are also not in favour of IFD. Countries hit hard by Chinese investments, such as Sri Lanka and Pakistan, are also opposing the move, he said.

A WTO document also mentioned about the oppositions to IFD proposals at the special general council on February 14. “Some members opposed incorporating the Agreement to Annex 4, saying that this joint statement initiative (JSI) was born without a clear ministerial mandate,” it said. Proposals brought through Annexure 4 are binding on only the signatories while others remain outside the pact.

India will also oppose continuation of moratorium on paying customs duties on cross-border trade through e-commerce, a second official said. Developed countries such as the US and European Union, who are key suppliers of such products, for example films and books in digital forms, gain out of that, and importing countries incur huge revenue loss.

“According to one study conducted in 2017, the total revenue implication was $10 billion, with India losing about $500 million then,” he said. India is supported by South Africa and Indonesia on this issue. “We will oppose extension of the moratorium.”

India may, however, not oppose a proposal for domestic regulations on services, which is known as Services Domestic Regulations (SDR), a third official said. A group of countries in December 2017 took an initiative with the aim of developing disciplines to facilitate services trade and mitigate the unintended trade-restrictive effects of measures relating to licensing requirements and procedures, qualification requirements and procedures and technical standards.

“India, which initially opposed it as decision of a group of countries ignoring the spirit of multilateralism, has finally agreed to accept it after the group agreed to extend the same benefit to all WTO members unconditionally, even while not reciprocating on this matter,” he said.

“Proposed SDR is WTO-plus. It will not infringe on any existing WTO obligations. Second, it is not part of JSI, which we (India) do not recognise. India may support if the matter comes for blessings of the multilateral body (MC13),” he added.

It will facilitate the process of recognising educational and other qualifications of professionals – such as doctors and IT professionals -- across the countries, he said, explaining that it would differ from Mutual Recognition Agreements, which are done bilaterally. “The proposal will help to establish standard procedure for recognising qualifications of service providers across countries without any discrimination, which would help in mobility of Indian professionals,” he added.

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