The Hindu Business Line : It is end of the day for G-4: Kamal Nath

New Delhi June 22 After sitting together with developed countries to hammer out a consensus for the early launch of the Doha Round of trade talks to liberalise world trade for goods and services, India today formally broke ranks to bet its fortune on the Geneva process of negotiations of the World Trade Organisation (WTO).

"It is the end of the day for G-4 (the US, the EU, Brazil and India) - now it is for the full membership of WTO to take the Doha Round forward," the Union Minister of Commerce and Industry, Mr Kamal Nath, said at a news conference here, after he staged a walkout with his Brazilian counterpart, Mr Celso Amorim, at a meeting in Potsdam (Germany) on Thursday.

The Potsdam conclave was the second one of the G-4 Trade Ministers since April 2007 when they had charted out a roadmap in New Delhi for meetings among themselves to engage on all crucial and contentious issues relating to the stalled Doha Round negotiations of the WTO.

Asked about the probability of meeting the deadline for concluding negotiations before this year-end, Mr Nath quipped "For us the bottomline is more important than deadline," obviously referring to India's stated stance that the livelihood security of millions of Indian farmers would not be compromised on any count.

Mr Nath blamed the US in particular, stating that it paid an estimated $10.8 billion last year in farm subsidies and at this week's meeting proposed an increase to $17 billion. He said, "The developed countries are looking at promoting and protecting the prosperity of their farmers, whereas in India we are talking about protecting the livelihood of our farmers."

Reasons for failure

He said the G-4 meeting broke down because of the failure of the developed world to accept effective reductions in their agricultural subsidies while simultaneously seeking additional market access in the developing countries for their agricultural products.

India has been taking a consistent stance that even as the Doha Round has been announced as a Development Round raising the expectations of the developing world that it would help them tackle the scourges of unemployment and poverty through increased trade opportunities for their produce and products, the current aspirations of many of the developed world were totally "oblivious to the development content of the Round and were instead focussed mainly on seeking greater market access for their own products".

Mr Nath said that on the issue of market access in non-agricultural products or industrial tariffs, the developed countries had trotted out Swiss coefficients which would have led them to take average tariff cuts in their industrial products of just over 30 per cent, while the developing countries would have had to reduce their tariffs by more than 60 per cent on an average.

He said this could only have helped the advanced countries to make heavy forays into the markets of developing countries, while offering negligible reciprocal gains to the latter. It also held out the spectre of de-industrialisation of the developing world along with a reduction of foreign direct investment flows into their countries.

"This was totally unacceptable to the developing countries as it would have led to increasing unemployment among their workforce," Mr Nath said adding that is why the G-4 meeting in Germany ended in a fiasco.