India to join WTO panel on govt purchases

India will join a World Trade Organisation panel as an 'observer' that would give the country an insight into how governments of developed countries place multi-billion procurement orders with the industry.

The Cabinet Committee on WTO cleared the proposal last evening for the country to join the "exclusive" club comprising 14 full-fledged members and about 20 observers.

"We will go through the process and become the observer (of the Government Procurement Agreement)," Commerce Secretary Rahul Khullar told PTI.

While the 'observer' status does not mean that India is under an obligation to subject its about $125 billion government purchases to the WTO rules, it could be taken as an initial signal that the country would eventually play the ball as desired by rich countries like the US and EU.

"While we were able to guard our government purchases from transparent global bidding, India too was getting it back through retaliatory steps like 'Buy America' in Obama Administration," an industry official said.

The government procurements constitute about 10-15 per cent of the global economy, according to the estimates of the World Trade Organisation.

"What is the harm (in becoming observer)," Khullar said when asked what is the advantage for the country.

"Unless I learn how the EU, the US and Canada conduct their government procurements how I am going to tailor my industry to get part of that procurement, be it on goods or services," Khullar said.