Concern over threat posed to WTO by US tariffs

The threat posed to the World Trade Organisation by the US action of selective imposition of import tariffs on steel and aluminium and ways to deal with it dominated the discussion at the informal Ministerial Meet in New Delhi on Tuesday.

India also batted for the need to preserve the mandate of special and differential treatment for developing countries while some members argued that larger countries should opt out.

Addressing a press conference after the meeting, attended by representatives of 51 countries, WTO Director-General Roberto Azevedo said that he had serious concerns about the ramification of the US action on tariffs.

“These measures have serious possibility of escalation. My hope is that the affected countries will talk it out and see how to handle this within WTO framework. That is how we can handle this,” said Azevedo .

The countries affected by the US action include Japan, Korea, India and the EU among others.

Azevedo said that India’s move to host the informal meet at the crucial moment when world trade rules were under threat showed the country’s commitment towards the multilateral framework.

Members who were represented at the meet included the US, the EU, Brazil, China, Russia and South Africa.

Special treatment

On the issue of special and differential treatment (S&DT) — which basically is an entitlement given to poorer countries to get more concessions from richer members and give fewer concessions in return — there were other members such as the US and the EU, who wanted larger developing countries, such as India, China and Brazil, to opt out. India, however, did not agree.

“S&DT for developing countries is a fundamental part of the WTO mandate. This must be carefully preserved. We do not support arguments which are based on indicators such as aggregate GDP but disregard the millions of people that live in poverty in these countries,” said Minister of State CR Chaudhary at the plenary session of the meeting.

The divergence of opinions was reflected in Commerce and Industry Minister Suresh Prabhu’s concluding remarks.

“The need for all developing countries, including LDCs, to benefit from S&DT in future trade agreements was emphasised in many interventions. While this was contested in some interventions, the need to find a way to address the issue in a balanced way was emphasised by some participants,” said Prabhu.

Divisive issues

The house was also divided over new issues such as e-commerce, investment facilitation and MSMEs. India said it could agree to discussing new issues only if they were trade related and it could be convinced that the rules being negotiated will be beneficial for developing countries.

India hosted the meeting with the hope to revitalise the multilateral talks that had taken a beating at the Ministerial Meeting in Buenos Aires in December 2017 with no major outcomes.

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