India denies WTO demand to drop differential treatment for developing countries

By Prarthana Mitra

In an informal session with the World Trade Organization (WTO) on Tuesday, commerce minister Suresh Prabhu continued to push for the Special and Differential Treatment (S&DT) clause despite attempts by other countries to remove such protectionist measures for developing economies.

Prabhu organised the two-day informal ministerial meet—which started on Monday—with 53 WTO members. Another very important topic of discussion at the meeting was the US’s decision to impose 25% and 10% tariffs on steel and aluminium respectively. At the conclusion of the meet, WTO Director-General Roberto Azevedo expressed his concerns about the impact of these tariffs.

“These measures have serious possibility of escalation,” said Azevedo. “My hope is that the affected countries will talk it out and see how to handle this within WTO framework.”

The meeting could not have arrived at a more turbulent time for the global economy, which is beset, amongst others, with the impending tariffs by the US and Washington’s allegations against India’s export incentive programmes at the WTO.

Also Read: Will Trump’s trade war wound India?

Protectionist is political

Earlier talks on the issue had reached an impasse due to an alarming rise in isolationist and protectionist foreign policies. At the last assembly of the WTO in Buenos Aires in December, the participating nations were deeply divided regarding the mandate to promote free trade.

Prabhu stressed on the need for developing as well as less developed countries to benefit from “S&DT provisions in future trade agreements.” Official sources from the WTO have reported the disinclination of opposing nations to look out for lower-income developing economies, claiming that global economy is ready for free trade and absolute free competition. Many have voiced their opinion about a “case by case approach” for those countries seeking “special dispensation”, but this alternative was opposed by India and South Africa.

Multilateral trade must be ensured at all costs

The meeting also addressed the increase in unilateralism in trade, especially in the West. Prabhu also dismissed the possibility of India’s embroilment in a trade war with the US, informing the panel that India will be engaged in bilateral discussions with the Trump administration for “import curbs on steel”.

In light of the demands made by many member nations (including the US), at the previous WTO conference, India is still non-committal about claiming the “developing country” status.