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Non-agricultural market access negotiations India presses for equitable tariff reduction formula

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Mr Kamal Nath
Mr Kamal Nath

Our Bureau

New Delhi, March 4

INDIA has called for an equitable tariff reduction formula in the negotiations on non-agricultural market access in the World Trade Organisation, keeping in view the concerns and interests of developing countries.

India's stance on the various negotiating points was made by the Union Commerce & Industry Minister, Mr Kamal Nath, while participating in the two-day meeting of leading WTO ministers in Kenya last evening, an official release issued here on Friday said.

The discussions on non-agricultural market access (NAMA) were constructive and useful.

For the first time, actual tariff reduction formulae in NAMA were discussed at the ministerial level. The European Union put forth a proposal for the Swiss type tariff cut formula entailing reduction of high tariffs by very high percentage which might affect developing countries, India responded by stating that it was not adequate. The US reiterated its suggestion for using two different coefficient for tariff reduction - one for developed and one for the developing countries. While Mr Nath endorsed the US suggestion, he, however, felt that even this was inadequate, as it required a lot of fine-tuning.

The Girard formula, which takes into account the extant tariff structures of member countries in line with the concerns of developing countries and uses coefficients for each country equal to its own tariff average, is the most appropriate mechanism.

Stating that even the Girard formula had its shortcomings, Mr Nath said that was why India, Brazil and China along with some other countries were working on a modified Girard formula to evolve a suitable formula for tariff reduction in the area of non-agricultural market access. "We are giving final touches to this and hope to able to table it shortly," he said.

He also raised the issue of non-tariff barriers (NTBs) in the non-agricultural sector, stating that persistence of NTBs would negate whatever flexibilities were available for developing countries in non-agricultural market access.

Making a forcible pitch for liberalisation of movement of natural persons as service providers under Mode 4, the Minister said "all these (requirements) qualifications, visas and licensing are being done in a non-transparent manner and acting as technical barriers to trade in services, just as sanitary and phyto-sanitary measures often act as technical barriers to trade in goods.

At the start of the two-day meeting, the WTO Director-General, Mr Supachai Panitchpakdi, said: "We are now calling on all membership involvement in trying to make preparations as best we can so that Hong Kong can put us on the road to successful completion."

(This article was published in the Business Line print edition dated March 5, 2005)
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