Nath flays US on special safeguards issue

Having secured a "convincing" trust vote in Parliament, Commerce Minister Kamal Nath yesterday issued a strong message to his two powerful counterparts "" the United States and the European Union "" that New Delhi is prepared to forego an agreement on the Doha Development Agenda (DDA) modalities if it fails to get a robust special safeguard mechanism.

In a hard-hitting message at the Doha trade negotiations committee meeting as well as at press conference, Nath said the industrialised countries must not adopt "self-righteous" positions on SSM when they had used a similar flexibility called special safeguards.

"If they insist our SSM must be subject to all sorts of shackles and restraints, it will not work," he said. "If it means no deal, so be it," he added. The SSM is an instrument to enable the developing countries to impose safeguard duties on imports of farm products when they surge and cross certain agreed thresholds to cause damage to domestic products.

Over the last three days, talks between the farm exporting countries, led by the United States, and developing countries, led by India, have almost broken down on what ought to be the triggers and remedies for SSM.

On industrial goods, Nath said India had brought down its industrial tariffs over the last ten years that helped the US to increase its exports by 74 per cent and the EU by 34 per cent last year, and asked, "Where is the question of holding back?"

If the industrialised countries want India to bind what it had done autonomously then "it depends on the balance that we achieve on the negotiations across the various areas, including in terms of paragraph 24 of the Hong Kong Ministerial Declaration that calls for balanced and proportional results in agriculture and market access for industrials.

On Tuesday, the US Senate Finance Committee ranking Republican Senator Chuck Grassley, who also is a senior member of the Agriculture Committee, criticised India for "laughing" at its latest proposal to reduce overall trade-distorting domestic support to $15 billion.

"I have yet to see India make a constructive proposal that will actually advance these negotiations," he said, suggesting that this is not a laughing matter for India.

Responding to such criticisms, Nath said, "Let me also say that those who accuse us of not moving on market access (the US), have not moved an inch since the Uruguay Round in reducing high tariffs or tariff peaks on exports of developing countries (textiles, leather items)."

If the negotiations are to proceed smoothly in the next three days, then industrialised countries must respect the principle of less than full reciprocity in the Doha non-agricultural market access reduction commitments, he said.

"The contribution that developed countries are being asked to make is too low to fulfil this part of the mandate," Nath argued.

India is ready to make ambitious commitments in Services during the Signaling Conference on Services on Friday but expects others to reciprocate in its core areas of interest like Mode 4 relating to the movement of short-term services providers and Mode 1 relating to cross-border services.

He said India will press for a decision on disclosure provisions for genetic material at the ministerial and will insist on a balanced outcome on all issues.