Bali was a damp squib

Ranabir Ray Choudhury | Updated on December 10, 2013

Gita Wirjawan : tempered optimism

Developed world holds the aces at WTO.

Late last week, Union Commerce Minister Anand Sharma, who led the Indian delegation to the ninth WTO ministerial conference at Bali, declared: “It’s a great day because it’s a historic decision. It’s a victory not only for India but for all developing countries. It’s a victory for WTO and all countries which have come to a mature decision.” He was, of course, commenting on the agreement hammered out on the food security issue and trade facilitation, the latter being expected to add a trillion dollars to the total annual value of world trade.

Sharma was not alone in expressing his happiness over the outcome of the meeting. His Indonesian counterpart, Gita Wirjawan, said, “We did it…it is a historic deal…these are historic achievements”, adding as an afterthought, “but there is still much to do”.

Small picture

There is bound to be relief for the negotiators, but this is only the small picture. Indeed, the big picture is controlled by the long-term attitudes of protagonists, which, in turn, are determined by the imperatives of State policy. The big picture has not changed at all — in the larger economic struggle with rich and developed countries, poor and developing nations have not made any headway at all.

This point of view may seem cynical, especially in view of the fact that the Bali Declaration has made every effort to weave in the results of the conference with the Doha Development Round. Thus, paragraph 1.4 reads: “We particularly welcome the advances made in the Doha Development Agenda (DDA), as represented by the decisions and declarations we have adopted at our present session. These…signify that we have taken a major step forward in the negotiations and attest to our strong resolve to complete the DDA.”

Sharma himself waxed eloquent when he said that India had “played a major role in the revival and re-energising the Doha Round of talks”, the Bali declaration being “a positive step” in that direction. WTO Director-General Roberto Azevedo told the members of his organisation: “We have put the ‘world’ back in World Trade Organization. We’re back in business...Bali is just the beginning.”

On the surface

Nothing of the sort has happened. True, the waiving of the food subsidy de minimis is a feather in the cap of the UPA government, but one which has been ignored by the people, as revealed by the results of the recently-held elections. The agreement at Bali will now allow the WTO to monitor in some detail the domestic policies on food subsidy. This apart, the trade facilitation agreement is certain to cut both ways, perhaps being more helpful for developed-country exports than the other way around.

Bali did nothing more than make developing countries feel happy with an apparent concession. Economies which are increasingly becoming dependent on food security legislation need to be treated differently by the developed world when it comes to tough negotiations on international trade issues such as agriculture, non-agricultural market access, services, and so on. This is the essence of the Doha Round.

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Published on December 10, 2013
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