Muddled in crisis, government faces Doha Round test

NEWS ANALYSIS

The meeting is scheduled to begin on July 21 at the World Trade Organization. WTO Director-General Pascal Lamy fixed the ministerial meeting a fortnight ago just when the political crisis centering on New Delhi's proposed safeguards agreement at the International Atomic Energy Agency (IAEA) began to unfold.

Lamy is keen to finalise the modalities (parameters) by hook or by crook before the end of this month because of the political realities in the United States and elsewhere.

The modalities, if agreed, will suggest the level of tariff and subsidy cuts for the farm products and the tariff cuts for industrial products that WTO members will have to implement as part of their Doha commitments.

Despite little over 50 per cent chances for a successful outcome at the ministerial meeting, Lamy took the big risk as a last ditch effort to salvage the Doha Round from going into a freeze for another two years.

Indeed, many countries raised doubts about the value and worth of a modalities deal at this point when the US administration is unable to secure an approval from its Congress for any bilateral or multilateral trade agreement.

More so, when Congress passed its new Farm Bill with over $300-billion worth farm subsidy programmes, several members sought to know whether it is worthwhile to enter into a modalities agreement that is already undermined by the US' Farm Bill.

Of course, the US negotiators maintained that if there is a successful agreement at the WTO then it would take precedence over the Farm Bill