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With the COP26 Climate Summit under way, the WTO Secretariat has come up with information briefs on trade, climate and related issues, which also refer to the need to liberalise trade in green technologies.
But India is unlikely to extend support to negotiations on lowering tariffs on ‘environmental goods’, as it is also concerned about dual uses of such goods that could lead to import of items with non-environmental end uses, an industry source said.
“Reducing trade barriers to green technologies will facilitate access and increase adoption of these technologies to help accelerating the transition towards a more sustainable economic model,” according to a WTO brief titled Carbon Content of International Trade.
WTO Director General Ngozi-Okonjo Iweala, in one of the sessions at the COP26, said, “Lowering trade barriers helps to stretch each dollar of adaptation finance further. This makes it more affordable to invest in cutting edge technologies for addressing risks from sea-level rise, drought, extreme weather events and floods.”
The WTO’s intervention at the COP26 is important especially in the context of the forthcoming 12th Ministerial Conference of WTO on November 30-December 2 2021 where the Trade and Environmental Sustainability Structured Discussions (TESSD) group, comprising 53 WTO members such as Canada, Australia, New Zealand, Japan, Fiji, Costa Rica, the EU and the UK, is keen to initiate action around environmental goods. The TESSD’s role in promoting negotiations on environmental goods is now central as the Environmental Goods Agreement (EGA) negotiations, a tariff-cutting initiative by a subset of the WTO’s membership (excluding India), stalled in late 2016
Possible dual use
“India is resisting an agreement on reducing tariffs on environmental goods because it can be a risky proposition because of possible dual use. Since such goods are not properly defined, there is a big chance of goods being traded at reduced duties under the garb of saving the environment for totally non-environmental end use,” sources said.
For instance, a pipe, ostensibly for a renewable energy plant, can be used in other plants as well. In fact, some experts argue that apart from a handful of products, like wind energy apparatus, most environmental goods can have multiple non-environmental uses.
The COP26 will continue to refer to supportive trade policies to combat climate change, but countries like India need to carefully protect their interests on the proposed liberalisation of environmental goods and technologies, sources said.
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