Print Friendly, PDF & Email

WTO strikes global trade deals

Gs paper-3

Syllabus:  Effects of liberalisation on the economy (post-1991 changes), changes in industrial policy and their effects on industrial growth.

 

Context:

The World Trade Organization’s164 members (12th Ministerial Conference) in a historic step approved a series of trade agreements including commitments on fish, a partial waiver of intellectual property (IP) rights for COVID-19 vaccines, and pledges on health and food security.

Important Deals struck:

  • On Fisheries: prohibited certain forms of fisheries subsidies that contribute to overcapacity and overfishing, and eliminates subsidies that contribute to IUU-fishing recognizing that appropriate and effective special and differential treatment for developing country Members and least developed countries.
    • The accord to curb fishing subsidies is only the second multilateral agreement setting new global trading rules struck in the WTO’s 27-year history and is far more ambitious than the first, which was designed to cut red tape.
    • The fishing subsidies deal has the potential to reverse collapsing fish stocks
  • On partial IP waiver: Allowed the developing countries to produce and export Covid vaccines
  • Maintaining a moratorium on e-commerce tariffs: It is considered vital to allow the free flow of data worldwide.

India’s Leadership:

India has been able to secure a favourable outcome at the WTO after many years, despite a strong global campaign against Indian farmers and fishermen.

 

What were the concerns raised by India at WTO:

  • On issues of Fisheries and E-commerce: Revmoval of subsidies will hurt fishermen. So, India demanded to make extensive exceptions on a 20-year negotiation to cur harmful government fishery subsidies.

 

Current Affairs

 

 

India is seeking broad exemptions for its fishing industry, including a 25-year phase-in period and a 200-nautical-mile exclusion for its artisanal anglers.

  • On E-commerce: India fears that new rules could provide the pretext for unfair mandatory market access to foreign companies. This will hurt the rapidly growing domestic e-commerce sector, which is still developing in India.
  • On Food: WTO should renegotiate subsidy rules for government-backed food purchasing programs aimed at feeding poor citizens in developing and poor countries.
    • India wants assurances that its public stock-holding program, which buys exclusively from the nation’s farmers and has exported in the past, cannot be challenged at the WTO as illegal.
  • On vaccines: India wants to waive IP rights for vaccines and extend the WTO ban on digital duties
  • Special and differential treatment (S&D) must continue, as such treatment has been a treaty-embedded and non-negotiable right for all developing members
  • Principles are sacrosanct: Ensure that multilateral rule-making processes are neither bypassed nor diluted. The principles of non-discrimination, predictability, transparency and most importantly, the tradition of decision-making by consensus need to remain sacrosanct.

 

Prelims Link

To know more about WTO: Click here

Mains link

Issues faced by WTO and suggested reforms: Click here

 

Practice Question:

Q. For India, though the multilateral trading system embodied by the WTO provides security and predictability. India has had a chequered relationship with the World Trade Organisation (WTO). Examine. Also, Suggest reforms that needs to be undertaken in the WTO. (250 words)

Source: World Trade Organization