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 New Delhi has insisted that, in exchange for signing the trade
facilitation agreement, it must see more progress on a parallel pact
giving it more freedom to subsidize and stockpile food grains than
is allowed by World Trade Organisation rules.
The WTO deal must be signed in Geneva on Thursday, and India's
ultimatum has revived doubts about the future of the WTO as a
negotiating body.
"I am an optimist, I am hopeful that within the period of
today...there is a common ground that is found," U.S. Commerce
Secretary Penny Pritzker, accompanying Secretary of State John Kerry
during annual strategic talks with India, told NDTV.
India's new nationalist government has demanded a halt to a globally
agreed timetable on new customs rules and said a permanent agreement
on food stockpiling and subsidies aimed at supporting the poor must
be in place at the same time, well ahead of a 2017 target agreed
last December in Bali.
Kerry warned India it stood to lose if it refused to budge.
"Right now India has a four-year window where it's been given a safe
harbor where nothing happens," he told NDTV.
"If they don't sign up and be part of the agreement, they will lose
that and then (they will) be out of line or out of the compliance
with the WTO."
Pritzker said serious efforts were underway on Thursday to save the
deal, which proponents say could add $1 trillion to the global
economy and create 21 million jobs.
DEAL WITHOUT INDIA?
As trade officials in Geneva tried to rescue the deal, India's Trade
Minister Nirmala Sitharaman said New Delhi's position remained
unchanged.
An Indian government source added separately that the Bali deal need
not collapse even if the July 31 deadline is not met.
But several diplomats said New Delhi's stance could derail the whole
process of world trade liberalization, leading some WTO nations to
discuss informally the last-ditch idea of excluding India from the
agreement.
"If India does end up blocking (on Thursday) there is already a
group of members who are interested in pursuing that path," a source
involved in the discussions said.
"A dozen or so" of the WTO's 160 members had informally discussed
pushing ahead with the trade facilitation agreement with less than
100 percent participation, the source said.
An Australian trade official with knowledge of the talks said a
group of countries including the United States, European Union,
Australia, Japan, Canada and Norway began discussing the possibility
in Geneva on Wednesday afternoon.
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A Japanese official familiar with the negotiations said Japan was
still working on reaching a consensus, while a State Department
official traveling with Kerry in India said the United States
continued to talk with India on the deal.
A WTO spokesman said the group's director-general would hold
meetings throughout the day to "avert a crisis.
"Delegations are showing real commitment to finding a solution and
the director-general remains hopeful that a solution can be found,"
he said.
"ACTIVE DISCUSSION"
Technical details would still have to be ironed out, but there was a
"credible core group" that would be ready to start talking about a
deal without India when WTO diplomats return from their summer
break, the Australian official said.
To what extent the alternative proposal, and India's hardline
position, were part of political brinkmanship was unclear. New
Delhi's absence from any agreement would be a setback given its size
and importance in global trade.
"What began as a murmur has become a much more active discussion in
Geneva and I think that there are a lot of members in town right now
that have reached the reluctant conclusion that that may be the only
way to go," the official said.
Trade diplomats had previously said they were reluctant to consider
the idea of the all-but-India option for the customs pact, partly
because it would be hard to exclude one free rider and partly
because the agreement in its current state requires an amendment to
the existing WTO treaty, which appears to make India’s cooperation
vital.
Others pointed out that many countries, including China and Brazil,
have already notified the WTO of steps they plan to take to
implement the customs accord immediately.
Other nations have begun bringing the rules into domestic law, and
the WTO has set up a funding mechanism to assist.
One trade diplomat in Geneva described two worlds moving in
parallel, with a few WTO members wrangling with India, and others
moving ahead as if oblivious to India’s objections.
(Additional reporting by David Brunnstrom, Manoj Kumar and Krista
Mahr New Delhi and Tom Miles in Geneva; Writing by Sanjeev Miglani;
Editing by Mike Collett-White and Raju Gopalakrishnan)
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