The letter below is a demand to MPs to demand a debate in the ongoing parliament session and call for accountability from Commerce Minister Kamal Nath when
he goes to Hong Kong.

If you are in agreement with the contents of the letter and want to sign on please send a mail with the full name of your organisation to This email address is being protected from spam bots, you need Javascript enabled to view it or This email address is being protected from spam bots, you need Javascript enabled to view it

Please treat this as a priority and respond as soon as possible.

The World Trade Organisation (WTO) will hold its sixth Ministerial Conference from December 13th to 19th, 2005 in Hong Kong.  The primary aim of the Hong Kong Ministerial Conference is to agree on the elements of a new trade deal to enable the conclusion of the so-called “Doha Development Round” that was launched in the Doha Ministerial Conference in November 2001.
For majority of the people in developing countries, however, there is nothing developmental about the “Doha Development Round.”  This round of negotiations marginalizes yet again the issues of greatest interest to developing countries: the ability to use trade policy in the service of development, implementation of commitments made by developed countries during the Uruguay Round, and special and differential treatment for developing countries.  The deep, anti-development bias of the WTO allows developing countries very limited space to advance or even defend their interests.

The Government of India (GoI) seems set to negotiate positions in this round that will have far-reaching and disastrous consequences for the country’s economy and polity, particularly for the peasantry and working classes.  Such a mistake was made once before, at the conclusion of the Uruguay Round (UR) of negotiations in 1995 from which the WTO was born.  The GoI sought to justify that by highly exaggerated estimates of "gains" that India would get, which were computed by biased "experts."  But the past 10 years have proved the predicted gains to India and other developing countries from the WTO to be empty promises. It is now widely acknowledged that developing countries were short-changed in the UR, and that the WTO’s structure, rules, and processes are systematically biased against the interests of developing countries.

In the current round of negotiations, the situation is not much different from the past.  The United States (US), European Union (EU) and other trade majors are demanding greater market access from developing countries to their agricultural, non-agricultural, and service sectors, in exchange for cosmetic cuts in their own massive agricultural subsidies.  The draft negotiating text for the Hong Kong Ministerial Conference that has just been released under the authority of the WTO’s Director-General Pascal Lamy lays out a framework to force open the agricultural, industrial and services markets of developing countries, well before producers and suppliers in these countries are able to withstand the rigorous competition from the giant multinationals of the US, EU and other trade majors.

Negotiations are presently stalled because most developing countries are blocking the negotiating strategies of the rich WTO members.  However, this situation can change at any time; the US and EU are ratcheting up the pressure on lower income developing countries with promises of greater aid, technical assistance packages, and special and differential treatment, and on middle income countries with promises of visas and selective market access in their areas of interest.

By all current indications, the only deal that can be inked at Hong Kong will be a deal that would force developing countries to make damaging concessions in agriculture, services, industrial goods and other sectors. Given the structural inequality and asymmetry built into the various WTO agreements, which favour developed countries, India's long-term interests are best served by making common cause with other developing countries. However, the GoI appears to have given up this path altogether and has displayed more interest in allying with the EU, US and other trade majors.

Commitments made in the WTO are rendered practically irreversible by the WTO’s powerful Dispute Settlement Mechanism (DSU).  Before such commitments are made, India must seriously and comprehensively assess the impacts of past liberalisation on the majority of its population, especially those who are most vulnerable to economic crises and shocks.  The undersigned organisations appeal to parliamentarians across political affiliation to urgently take a close look at the issues involved, and to assert their authority as peoples’ representatives to call a halt to this hazardous process.

Democracy

The ability of India’s Parliament and Legislative Assemblies to pass and enforce regulations and laws to uphold the public interest will be severely compromised if the current negotiations are successfully completed.  Particularly egregious are the negotiations on domestic regulation in the General Agreement on Trade in Services (GATS), which would more or less render the Indian state powerless to pass any legislation that interferes with the profits of private companies.
Equally worrying is the lack of transparency on the side of the Indian trade negotiators.  India’s negotiating stance is shaped through closed-door consultations with India’s elite professional and industrial lobbies, and so called “experts.”  The Ministry of Commerce (MoC) has not sought the views of those would bear the brunt of further liberalisation, for example, peasant and family farmers, artisanal fishers, workers, local small scale service providers and retailers, small industries, and urban and rural poor; nor has it opened its negotiating stance to scrutiny by the country’s elected law makers.  The MoC’s only outreach attempts have been a few “stakeholder consultations” organised by the United Nations Conference on Trade and Development (UNCTAD), which have sought to legitimise India’s negotiating positions rather than steer them in a direction that would benefit the majority of India’s population.  Participation in these consultations has been limited to selected urban groups and is hardly reflective of the reality in India.  The role of UNCTAD in organising these consultations is also questionable, especially since they seem to have completely by-passed state and national level democratic fora.

Livelihoods

The WTO's Agreement on Agriculture (AoA) is biased in favour of large scale, commercial agriculture in developed countries.  It threatens the livelihoods of the vast numbers of small-hold and marginal farmers and agricultural workers in India and other developing countries, where food is largely sourced and consumed locally and seasonally.  The draft negotiating text on agriculture permits the US and EU to continue subsidies to their domestic agribusinesses, while compelling developing countries to open up their markets even further to highly subsidised and therefore artificially low-priced food and agriculture imports from developed countries. If India accepts this text, its food sovereignty and security will be endangered, and its peasant producers and agricultural workers will be forced to surrender their sources of livelihood to the volatile dynamics of global agriculture markets and the increasing power of corporate agribusiness over which they have no control.

Over the past two decades, the policy space available for developing countries to use trade as a development tool has shrunk dramatically. And if the developed countries have their way in the current NAMA (Non Agricultural Market Access) negotiations, this space will shrink even further, making industrialisation and economic development in the developing world all but impossible. The jobs and livelihoods of vast numbers of India’s working class--most importantly of those involved in small scale and artisanal fishing—are threatened by the NAMA negotiations. Any reductions in bound and applied tariffs in industrial goods, fisheries and natural resources are likely to have wide ranging negative impacts such as factory closures, job losses, environmental degradation, and depletion of marine and coastal resources.

India has broken ranks with the majority of developing countries in NAMA negotiations by accepting proposals for tariff binding and reduction, and sectoral negotiations which seek to reduce tariffs down to almost zero in areas such as fisheries.  Current NAMA proposals do not sufficiently address Non-Tariff Barriers (NTBs) and Technical Barriers to Trade (TBTs), which are the main forms of protection by developed countries of their own markets.  Further tariff reductions through NAMA negotiations will not lead to greater market access for developing countries, but will certainly accentuate their de-industrialisation by ensuring greater market access for developed countries.

Services and Public Interest

The deal being pursued most aggressively by rich countries for agreement in Hong Kong is in the liberalisation of services through the General Agreement on Trade in Services (GATS).  GATS places over 160 services sectors on the table for liberalisation, and mandates that countries change national laws to ensure that foreign service-providers have equal access to local/national markets as domestic service-providers.  Services in the GATS include water, education, health, energy, transport, telecommunications, financial services, banking, travel and tourism, to name just a few.

In previous negotiations, developing countries had succeeded in building some safeguards into the GATS to protect their interests. They were expected to table fewer sectors for liberalisation, and that too only in line with their stage of development.    Developed countries are now seeking to remove these safeguards by speeding up the negotiating process through “complimentary approaches,” "benchmarking" and “plurilateral approaches,” all of which will compel developing countries to liberalise their services sectors whether or not they are structurally prepared for this.  While many developing countries have opposed these moves vociferously, India has not been clear or vocal in its opposition to them, seeking instead to pursue concessions from the US and EU for more visas for its elite professionals in high value sectors such as software, information technology and biotechnology.

The draft text on the negotiating table for the Hong Kong Ministerial Conference completely undermines the existing flexibilities in the GATS architecture and mandates that developing countries open up their services sectors for liberalisation before they are ready to compete with the services corporations of the developed world.  Equally worrying is language in the text that liberalises government procurement, and ushers in investment and competition policy.  Known as New Issues or Singapore Issues, government procurement, investment and competition were rejected in the last Ministerial Conference in Cancun by developing countries, but are now being brought back into the WTO through the GATS.  If the current negotiating text is agreed on, the potential for developing countries to develop their services sectors as new sources of economic growth will be obliterated. In fact, unemployment will be on the rise as existing service providers come under threat. Access to services for all will also be in question since the liberalisation / privatization processes will not prioritise universal provision. Unfortunately, India is again breaking ranks with other developing countries by actively supporting this text.

Collective Intellectual, Natural and Cultural Wealth

The Agreement on Trade Related Aspects of Intellectual Rights (TRIPS) was one of the most controversial and bitterly fought over agreements during the UR, and was ultimately forced by developed countries into the WTO in 1995. TRIPS was, and continues to be an agreement that protects the profits and interests of private, often trans-national corporations, especially from rich countries.  There is today growing evidence globally that TRIPs jeopardizes universal access to medicines and severely restricts the dissemination of scientific knowledge and technology in diverse sectors such as software, public health and medicine, biotechnology, etc.  TRIPs has also been used by agribusiness corporations from developed countries to claim exclusive ownership on seeds, local knowledge, micro-organisms and other life-forms through product and process patent protection. 

Although language on TRIPs for the draft Ministerial text has yet to be inserted, indications are that the likely language would make it even more onerous for developing countries to override TRIPs provisions in the case of public health crises.

Appeal

The WTO is clearly not a framework within which India or any developing country can pursue a positive development agenda.  Given the legal power and irreversibility of WTO commitments, it is imperative that India’s positions in the current round of negotiations—leading up to the Hong Kong Ministerial Conference as well as beyond it--are unambiguously explained in a White Paper and discussed in the Parliament. In the interests of democracy, the domestic economy and national security, it is crucialt that an informed debate takes place on the floor of Parliament, and that no commitment is taken without a national consensus to back it. Pending such a discussion we appeal to parliamentarians of all political parties, to stop the GoI and the MoC from taking the negotiations forward in the December WTO Ministerial Conference in Hong Kong.

In particular, we urge you to issue the following directives:

1.      India must insist that an independent and comprehensive review be undertaken within the WTO structure of the impacts of the AoA on developing countries during the 10 years of its operation.  There should be no further negotiations in agriculture until such a review has been satisfactorily completed and discussed.

2.      India must firmly stand up for the rights of all developing countries to reinstate and use Quantitative Restrictions (QRs) on imports of agricultural products, so as to enable countries to selectively de-link their agriculture from the onslaught of the volatile global market, to protect it from the depredations of agri-business, and to secure policy space to work out appropriate ways to address their agrarian priorities.

3.      India must not agree to the NAMA proposal under negotiation.  It must not agree to the universal binding of industrial tariffs, or compromise future policy space in any other way.  Instead, India should fight for the rights of developing countries to protect their industrial, environmental and fisheries sectors as required to enhance national development, employment and livelihoods.

4.      Fisheries and all natural resources goods must be removed from NAMA negotiations.  It is completely unacceptable that such environmentally and socially sensitive sectors are subject to the same negotiating rules as footwear and toys.

5.      India must insist that independent and comprehensive reviews be undertaken within the WTO structure of the impacts of past liberalisation commitments before any more liberalisation commitments are made.  In fact, there should be no further negotiations on the GATS until such a review has been satisfactorily completed and discussed.

6.      Specifically within India, an inter-sectoral team appointed by the Indian Parliament should conduct a comprehensive assessment of the impact of past liberalisation and privatisation of services.  Such an assessment must especially examine impacts on a) the access of ordinary Indians – particularly economically and socially vulnerable communities--to timely, affordable and quality services; b) changes in levels, patterns and nature of employment; c) livelihoods, social and economic security, and welfare, particularly among vulnerable communities; d) domestic Small and Medium Enterprises, and; e) the ability and willingness of the central and state governments to enact and implement regulations that protect the public interest and welfare.

7.      India must oppose all proposals for “benchmarking,” “complementary approaches” and plurilateral approaches in the GATS.  Countries must have the freedom to liberalise their service sectors at their own pace and according to their own specific structural conditions, with adequate domestic regulations, and legal and institutional measures to counteract the social and economic costs of services liberalisation.

8.      India should not accept Mode 4 visa concessions as an incentive to open up India’s services sectors to liberalisation. Gains--if any--from Mode 4 will benefit skilled, white-collar professionals who already have sufficient opportunities to move across borders and more important, foreign corporations who will be able to reduce their operating costs by importing cheaper professional expertise from India.

9.      India must oppose all attempts to introduce the liberalisation of investment, government procurement and competition through GATS negotiations on Mode 3, domestic regulation and other provisions.  India must defend its right and ability to use domestic regulation and procurement of services and goods as tools to protect the interests of its citizens, and strengthen its domestic services sectors and industries.

10.  India must press for a comprehensive review of the impacts of the TRIPS agreement on developing countries and press for a removal of the TRIPS Agreement from the WTO.