Economy and Business

India's Surrender at Nairobi

The 10th World Trade Organization (WTO) ministerial meeting held at Nairobi last year has exposed the glaring chinks in Narendra Modi government’s diplomatic armory. 

Jan 11, 2016
By Seema Sengupta
The 10th World Trade Organization (WTO) ministerial meeting held at Nairobi last year has exposed the glaring chinks in Narendra Modi government’s diplomatic armory. 
And Indian interlocutors returning empty handed from the conference virtually puts to rest a long-trumpeted propaganda of Modi being an invincible policy manipulator, adept at the cut and thrust of international diplomacy. Had it not been for Pakistan Prime Minister Nawaz Sharif’s magnanimity of helping Modi erect the façade of a statesman in Lahore on Christmas Day, India’s overambitious premier would have been in the headlines for colluding with the rich nations in undermining the country’s trade interests. 
Indeed, Modi’s government has let the prosperous countries have their way by compromising on the Doha mandates. Clearly team Modi is bereft of that strong will and wherewithal, necessary to deftly handle sophisticated trade negotiations. And yet, this is the same Modi who drew flak from the US and other western powers for insisting on WTO accommodating India’s food security concerns before taking any decision on trade facilitation agreement at 2014 Bali conference. While US Secretary of State John Kerry criticized Indian intransigence in no uncertain words, Dave Camp, Chairman of the chief tax-writing committee (Ways and Means) of the US House of Representatives termed such actions as completely unacceptable and something, which put into doubt New Delhi’s credibility as a responsible trading partner. And House Ways and Means’ Trade Subcommittee Chairman Devin Nunes went a step further, accusing India of betraying the developed nations’ trust. 
“It is one thing for a country to be a tough negotiator. It is entirely another to agree to a deal with your trading partners and then just simply walk away months later, insisting instead on one-sided changes” asserted Nunes, adding, India runs the risk of losing international goodwill. Many in India who lauded Modi’s dogged determination to safeguard national interest at Bali believed, he is one political executive who will not only not succumb to US diktat on trade, commerce and security related issues, but will steadfastly refuse to subscribe to what is known as “Washington consensus” whereby smaller powers are required to align their policies with that of America’s strategic geopolitical-cum-economic interests.
If the primary responsibility of Modi’s government is to the poorest people of the country — as the Indian premier boldly put across the message to Kerry in August 2014 — what made India’s arguably most popular political figure in recent times, abandon his strong nationalistic stand and start behaving obsequiously in a year’s time? 
Government sources reveal Commerce Minister Nirmala Sitharaman, invitee to the select group of countries which negotiated the final text of the Nairobi agreement, capitulated after Modi refused to give permission to the Indian delegation to seek amendment to the Nairobi ministerial declaration or block it as a last resort. To be fair, an outspoken Sitharaman and her team did put up a gallant fight for the cause of Indian farmers’ rights and national food sovereignty, before being fettered by the highest political leadership’s invisible guidance midway. No wonder why a subdued Sitharaman expressed her “deep disappointment” at India’s red lines being breached without any reaffirmation of the Doha Development Agenda in the final ministerial agreement. 
Indeed, no concrete agreement on a special safeguards mechanism to protect farmers in the developing world against sudden import surges could be reached and neither did the final declaration mention any short deadline for a permanent solution on public stockholding for food security purposes. A mere promise to negotiate an unspecified safeguard mechanism for developing countries was the icing on the cake. Besides, new issues like competition policy, government procurement and investments are now open for future negotiations. Does Modi realize that by preventing Sitharaman to go her predecessors Murasoli Maran, Kamal Nath or even Arun Jaitley’s way of not ceding ground to countries discreetly encouraging ultra-protectionist and trade-distorting policies and actions, he has only ensured that India will pay a far heavier price in future negotiations? What prevented India from using export competition pact and export subsidy issues as bargaining chips in Nairobi? How is it that the Indian leadership failed to gauge the rich nations’ mood even though they have openly pronounced, prior to the Nairobi meet, the world must have the courage to look, think and act beyond Doha? Was Modi not aware that the developed world has always maintained that countries like India and China cannot ask for concessions envisaged in the Doha mandate? And at the end of the day, rich nations’ representatives were able to drive a wedge by pitting the least developed and vulnerable countries against developing world’s frontline economies. 
Unfortunately, Modi, like his western counterparts, believes that state support is killing Indian farmers as heavy subsidy has created a massively distorted domestic farm market. Modi, says sources close to him, is confident that Indian farmers if unshackled can compete successfully on the world stage. But then, Modi needs to be reminded that while there is a need to introduce domestic reforms in farm sector unilaterally, the government must not surrender its existing flexibility to formulate public policies favorable to poor farmers and consumers. 
As rightly pointed out by eminent Indian geneticist M.S. Swaminathan, the Nairobi meet output failed to differentiate farmers in poor nations, taking to agriculture for livelihood security, from those in industrialized countries, to whom farming is a profitable business model. Worse still, Swaminathan predicts WTO Nairobi will exacerbate food insecurity instead of fulfilling United Nations’ zero-hunger goal.
Arab News, January 11, 2016

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