WTO: CALL FOR A STANDSTILL IN GATS NEGOTIATIONS

26 November 2005

Dear Member of Parliament,

From 13-18 December 2005, Trade Ministers will meet in Hong Kong to decide the future course of global negotiations in the World Trade Organisation (WTO).

The undersigned social movements, trade unions and civil society organisations are writing to all members of the Indian Parliament with several urgent concerns on substantive issues with regard to India’s current position in one of the key negotiating areas: the WTO’s General Agreement on Trade in Services (GATS). Our concerns are further elaborated in Annexure 1, which is attached to this letter.

1.          Undermining National Well-Being and Welfare

Over 160 services sectors are in the offing for liberalisation under the GATS and it seems clear that the Ministry of Commerce is not sufficiently equipped to understand the complex economic, social and environmental implications of bringing these sectors into the WTO framework.

It is crucial that lessons from already existing liberalisation and privatisation attempts inform India’s negotiating position in the GATS. This assessment is yet to be done by the Indian Government. Opening up the services sector through the GATS without adequate assessment of the impacts of liberalisation and privatisation on national employment, livelihoods, equity and welfare is likely to result in far reaching negative impacts to a broad cross-section of people, particularly those in the low-income brackets and situated in rural areas.

2.          Undermining Policy Sovereignty

India’s GATS commitments will seriously compromise India’s policy sovereignty, and render the Indian state powerless to introduce new regulations, and to penalise foreign services providers for high costs, poor quality and inadequate access to services by Indian consumers.

Bound commitments under the GATS will limit the ability of the central and state governments to enact and enforce domestic regulations in the public interest relating to licensing, technical standards and qualification requirements. GATS clauses of market access and non-discrimination to foreign services providers will weaken the power of government to supply essential services to vulnerable sections of society through cross-subsidisation. They will also restrict the government’s ability to further develop capacity in the Indian services sector through public procurement of goods & services.

3.       Who is driving the Negotiating Agenda?

An examination of present negotiations shows that the aggressive market access demands from developed country WTO members will not be beneficial to developing country members. Groups such as the EU are demanding aggressive liberalisation in Mode 3 (Foreign Direct Investment) and are calling for restrictions on foreign ownership to be removed. Making binding commitments under Mode 3 will seriously undermine the ability of governments to regulate foreign investment in the services sector.

Also questionable are the gains that India hopes to get from liberalisation through the Mode 4 route (temporary movement of labour). One of India’s key demands is that the US increase the quota of H-1B visas from its present GATS commitment of 65,000 to about 100,000. This mirrors the demands of big services corporations in the US. India has narrowed Mode 4 negotiations to the movement of highly skilled professionals and does not take into account unskilled or lower skilled workers. It is indeed unfortunate that India’s Mode 4 positions are ‘captured’ by business lobbies.

4.          Breaking Ranks Outside and Within

India was at the forefront of resistance by developing countries in the Doha (2001) and Cancun (2003) Ministerial Meetings to attempts by rich WTO members to introduce investment into the WTO. However, it appears that India is now no longer interested in maintaining collective positions with other developing countries to resist pressures by developed countries for the indiscriminate liberalisation of services. India has joined a select core group that is now driving the negotiations in the direction of “benchmarking” or “complementary approaches.”

5.       The Urgent Need for Parliamentary Scrutiny

Larger public interest cannot be traded away to maintain the myth of multilateralism through India’s commitments in the WTO, or to benefit a handful of domestic commercial enterprises that seek to expand their business opportunities to other countries. We must bear in mind that commitments under the WTO are irreversible and that policy actions have far reaching impacts, some of which may not be visible in the short term. Allowing water, energy, credit and banking to come under a weak regulatory environment that is biased towards corporate control will further undermine the productive capacities of India’s communities, workers and farmers (majority of Indian farmers are subsistence oriented peasant producers). Access to affordable services is crucial to building strong, healthy and productive societies. To defend the integrity of the services sector is to defend life.

Though able and intelligent, trade officials in the Commerce Ministry are not the best judges of ground level impacts of possible liberalisation commitments. Substantive consultations with regional and local governments, policy makers in critical sectors such as health, education, water and sanitation, environment, financial services, labour and social welfare, and with a broad cross section of civil society--including workers, unions, farmers, fisher-folk groups, women’s organisations and urban poor groups--is absolutely critical to fill these knowledge gaps. But to date, the few attempts by the Ministry of Commerce to engage in such discussions have been restricted to an extremely narrow base of constituencies and biased towards pro-GATS lobbies, while apprehensions voiced by those who would be most negatively affected by GATS commitments are not reflected in the Ministry’s positions.

Given this situation we urge you as an elected representative of the people of India to:

Call for an immediate halt on negotiations on services liberalisation under the GATS.
Unequivocally oppose all proposals for “benchmarking” or “complementary approaches” to services liberalisation.
Reject Mode 4 concessions as an incentive to open up India’s services sectors to liberalisation. Mode 4 does not promise any relief for the unemployment problem in India, since the EU, US and other rich countries will likely liberalize entry only for the most highly skilled professionals from India and other developing countries, thus worsening brain drain.
Demand that an inter-sectoral team appointed by the Indian Parliament conduct a comprehensive assessment of the impact of past liberalisation and privatisation of services.
Ensure that the Indian Governments position towards Hong Kong is comprehensively debated and decided in the Parliament
Services are, in one sense, the backbone of our societies and economies. Every aspect of our lives, from education, health, environment and transportation to energy, water, food, hotels and finance, are dependent on services. We cannot let these be taken out of democratic control and into the hands of a few Commerce Ministry bureaucrats to be signed away as trade-offs in the WTO.

This time around, the people of India refuse to be confronted with a “fait accompli” as in India’s previous WTO commitments. India’s citizens will challenge any commitment made without due democratic processes.

We appeal to parliamentarians to call for a complete standstill in GATS negotiations until the above issues are appropriately addressed.

SIGNATORIES AS OF NOVEMBER 26 2005
 

Adivasi Jangal Janjeevan Andolan, Dadra & Nagar Haveli
Akshara- Women's Resource Centre, Mumbai
All Assam Krishak Mukti Sangram Samitee
All India Bank Officers Association (AIBOA)
All India Bank Employees Association (AIBEA)
All India LIC Employees Federation
All India Port and Dock Workers Federation (Workers)
Avani Organic Producer Company Limited, Maharastra
Bharat Krishak Samaj Maharashtra State, Jalgaon
Bombay Urban Industrial League for Development, Mumbai
Brihan Mumbai Mahapalika Shikshak Sabha, Mumbai
Central Government Employees Coordination Committee
Capital Foundation Society, New Delhi
Centre for Education and Communication
Centre for Indian Trade Unions (CITU)
Centre for Organisation Research and Education (CORE), Manipur
Centre for Study of Global Trade System and Development, New Delhi
Combat Law Magazine
Corporate Accountability Desk of The Other Media, Chennai
Delhi Science Forum
DET, India
Equitable Tourism Options (EQUATIONS), Bangalore
Environment Support Group, Bangalore
Explorations, Mumbai
General Insurance Employees All India Association
GAIA (Global Alternate Information Applications), Thrissur
Girni Kamgar Sangharsh Samiti, Mumbai 
Gram Panchayat Leaders Association, Madurai
Green Brigade, Karnataka
Focus on the Global South, Mumbai
Hind Khet Mazdoor Sabha (HKMS)
Hind Mazdoor Sabha
Human Rights Law Network
India Centre for Human Rights and the Law, Mumbai
Indian Farmers Movement, (INFAM) Kerala
Indian Social Institute, New Delhi
Institute for Community Organisation and Research, Mumbai
Kabani –The other direction, Wayanad
Kamgar Va Majur Sangh, Thane
Karnataka Rajya Ryota Sangha (KRRS)
Kashtakari Sanghatna, Maharashtra
Kaviri Trust, Trichy
Kerala Swantantra Matsya Thoyillali Federation (Kerala Independent Fishworkers Federation)
Kisan Vigyan Kendra, Uttar Pradesh
Labour File Magazine
Lok Raj Sangathan
Maharastra Bandhkam Va Lakud Kamgar Sanghatana (MBLKS), Maharashtra
Maharastra State Government Employees Confederation,
Maharastra State Zilla Parishad Employees Confederation
Mahalir Vilipunarvu Sangam (Women Awareness Association) Namakkal, Tamil Nadu
Malabar Coastal Institute for Training Research & Action (MCITRA), Kerala
Narmada Bachao Andolan (NBA)
National Alliance of Peoples Movements (NAPM)
National Campaign Committee for Rural Workers (NCCRW), Maharashtra
National Forum of Fishworkers (NFF)
National Union of Seafarers of India (NUSI)
National Working Group on Patent Laws
National Confederation of Officers Associations of Central Public Sector Undertakings (NCOA) New Delhi
Open Space, Bangalore
Pasumai Trust, Tamil Nadu 
People’s Forum for Human Rights, Tamil Nadu   
Peoples' Political Front (PPF)
Plachimada Solidarity Committee, Kerala
River Basin Friends, North East India
Rozgar Hakk Samiti, Mumbai
Rural Volunteers Centre, Assam
Samajwadi Jana Parishad (SJP)
Samatha, Hyderabad
Shetkari Shetmajdoor Panchayat, Maharastra
SRED, Arakkonam
Success Trust, Pudukkottai
Sudar Society, Karur
Tamil Nadu Fish Workers Union
Tamil Nadu Kalludaikkum Tholilalar Sangam (TKTS)
Vesa, Nagappattinam
Vikas Adhyan Kendra, Mumbai
Youth for Unity and Voluntary Action (YUVA), Mumbai
Forum for Indigenous Perspectives and Action, Manipur
River Basin Friends, North East India
Rural Volunteers Centre, Assam
All Assam Krishak Mukti Sangram Samitee, Assam
Bhumi Putra Bhumi Adhikar Suraksha Mancha, Assam
Subansiri-Brahmaputra Mukti Sangram Samiti, Assam
Takam Mising Porin Kebang, Assam
Forum for Indigenous Perspectives and Action, Manipur