A top Indian official damped hopes of a revival of global trade talks on Wednesday, saying the economic downturn had damaged the will for a deal.
Rahul Khullar, India’s commerce secretary, said agreement at the Doha round of talks at the World Trade Organisation was out of reach while the world’s political leaders faced public anger in their countries over job losses and lack of economic growth.
The assessment will limit ambitions for a proposed ministerial meeting in Delhi and Group of 20 talks in Pittsburgh, US, in September. These were expected to revitalise the stalled talks and help boost the world economy.
Mr Khullar’s words also cast a shadow on the push by Pascal Lamy, the WTO’s director-general, to secure an agreement between the 153 members next year after nine years of negotiation.
Mr Khullar said: “I think that political leaders are going to have a hell of a time selling [a global trade deal] ...
“If we do not see an economic revival quickly – in the next two quarters – there is not going to be a new political movement [over trade].”
New Delhi’s trade negotiator said a change of guard at the negotiating table – among ambassadors at the WTO in Geneva and leaders in powerful trading countries – had set back the process. India has replaced commerce minister Kamal Nath, a veteran of WTO talks, with Anand Sharma, a former junior foreign minister.
“Negotiations are about people. The game has changed. Many of the people up to July have gone. Negotiating is about how much I trust you and how much I don’t,” said Mr Khullar.
India – alongside the US, the EU and Brazil – has been part of the core negotiating group at the WTO. It has been seen as one of the more recalcitrant of the big countries at the trade talks.
Mr Nath was blamed by some for their breakdown last July with his insistence on deeper cuts in US farm subsidies and more leeway for poor economies to protect their farmers with import tariffs.
Mr Sharma, since taking office in June, has expressed a desire for the talks to resume quickly. But one trade diplomat said on Wednesday that the purpose of the forthcoming meetings was in doubt if expectations were so low.
Another concern is the level of commitment in Washington to reopening trade discussions. Hillary Clinton, US secretary of state, gave little emphasis to their resumption on her visit to Delhi this month.
Economists fear that failure to agree the Doha round could lead to more protectionism. The WTO has noted such moves since the onset of the global financial crisis, in spite of pledges by world leaders to keep their markets open.
Source: Source: FT
