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WTO meet finalises draft

N. Ravi Kumar

Farm export subsidies to be eliminated

Hong Kong: Trade negotiators at the sixth ministerial conference of the World Trade Organisation on Sunday finalised a draft promising the elimination of all forms of agricultural export subsidies by 2013 and allowing concessions to developing countries on reduction of industrial tariff.

The draft, approved at the concluding session of the ministerial, brought cheers to India and its industry. Commerce and Industry Minister Kamal Nath said: "India welcomes the draft that sets the course of the development agenda."

Concerns about the six-day conference — which saw the cementing of unity among the developing and least developed countries, round-the-clock intensive deliberations and violent protests by those opposed to the WTO — not delivering anything concrete were sorted out when the second revised ministerial draft was accepted with minor changes.

Among other things, the draft decided on 2013 as the deadline for the elimination of all forms of export subsidies and "disciplines on all export measures with equivalent effect. This will be achieved in a progressive and parallel manner, to be specified in the modalities, so that a substantial part is realised by the end of the first half of the implementation period."

Mr. Nath said the agreement on the elimination of export subsidies would help protect Indian farmers from unfair competition in the domestic market even while opening up new opportunities for the export of agricultural products.

The ministerial draft allowed the developing countries to declare an appropriate number of Special Products — that would remain outside the ambit of the tariff reduction formula — on a self-selection basis. It also provided for a Special Safeguard Mechanism under which the developing countries would be able to raise their import duties on agricultural products in the event of a surge in their imports or a fall in their prices.

Industrial tariff

Stating that the modalities for the implementation, on the agreements, would be finalised next year, Mr. Nath said the draft took note of the ABI (Argentine/Brazil/India) formula for reducing industrial tariffs. The three nations recommended a multiple co-efficient Swiss formula based on each country's tariff average.

According to an official communiqué: "A clear instruction to focus on reduction of tariffs, especially tariff peaks and escalation, on products of export interest to developing countries has been included in the declaration."

It had been ensured that flexibilities for developing countries would be included in the final package. This reinforced the Paragraph 8 provisions of the July framework agreement (on Doha Round) allowing the exemption of a specific number of tariff lines from formula cuts.


On services, Mr. Nath said the policy space essential for developing countries had been fully preserved. It had been decided that discussions in Geographical Indications and Biological Diversity would be further intensified so as to be completed by June 30.

Fears about the second draft getting stuck on oppositions from some African countries on issues concerning cotton were allayed when Karan Bhatia, deputy trade representative of the U.S., told media that the U.S. and five African countries had "just now concluded" negotiations on cotton.

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