India, which found itself on the losing side at the 12th WTO Ministerial Conference, definitely needs to be corrected
India, which found itself on the losing side at the 12th WTO Ministerial Conference, definitely needs to be corrected
Global trade talks are about striking bargains. You lose some and win some. So, who were the main winners and losers in the recently concluded 12th Ministerial Conference (MC12) of the World Trade Organization (WTO)? Even a cursory scrutiny of the results of the meeting leaves us in no doubt that the European Union (EU) and some other developed countries are the overwhelming winners, while India finds itself on the losing side.
COVID-19 fight
The ministerial result on the so-called TRIPS exemption represents the biggest gain for the EU. It is relevant to remember the sequence of events. In October 2020, India and South Africa proposed to temporarily suspend the protection of intellectual property rights such as patents, copyrights, industrial designs and trade secrets to help in the production of vaccines, therapeutics and diagnostics. Overcome the crisis and fight the COVID-19 pandemic. The proposal received the support of about 100 countries in the WTO. It caught the imagination of many Nobel laureates, academics, civil society organizations, former prime ministers of many developed countries, former UN Secretary General and even Hollywood celebrities.
Opponents of the proposal, ie. Germany, the United Kingdom, Japan, Switzerland and the United States found themselves on the wrong side of global opinion on the issue. In June-July 2021, the US took a guilty step and gave its support to this proposal, but limited it to vaccines. In the process, he bought peace with his domestic constituents, including Bernie Sanders and Elizabeth Warren. Other developed countries, notably Germany and the UK, found themselves at the receiving end of the wrath of their civil society organizations and major opinion makers.
Benefits EU
Pushed into a corner, the European Union (EU) unleashed its masterstroke. This gave a counter-offer to weaken the proposal made by India and South Africa. This counter-proposition provided a cosmetic simplification in some of the procedural aspects of mandatory licensing in the patent rules. With the active support of the Director-General of the World Trade Organization, it also initiated a process in December 2021 to reach an agreement. In a completely opaque process, by March 2022, India and South Africa were forced to accept the EU proposal. This formed the basis of the final result in MC12. The ministerial result adds little to the already existing in the WTO rulebook. To make matters worse for developing countries, it adds stringent conditions that are not in the WTO rulebook.
The result of the TRIPS exemption has given the EU a new face, as it can now look into the eyes of its civil society organizations and confidently say that it has done its job to save the world from COVID-19. The end result is almost impractical; A huge PR victory for the EU.
The EU has also made significant gains in two other areas – WTO reform and environmental issues. In the name of reforming the WTO, the European Union sought to make fundamental changes to the WTO’s institutional framework. It also sought a formal role for the private sector in the processes of the WTO. And, it has achieved both these objectives in the ministerial outcome. The EU has also managed to create a window into the WTO to negotiate trade and environment-related issues, which are of concern to many developing countries.
no traction for india
Turning to India, the issue of permanent resolution of public stockholding was recognized by the Indian Minister of Commerce and Industry, Piyush Goyal as its top priority and nothing was more important to the world. Despite the support of more than 80 developing countries, the issue has not found a mention anywhere in the ministerial outcome. Instead, WTO members have succeeded in diverting attention from India’s interests by agreeing that food security is multifaceted, requiring comprehensive solutions.
India has also failed in many of its other objectives, such as securing the right to raise revenue by taxing electronic broadcasting. In the area of fisheries subsidies, two years are given to set up appropriate regulatory mechanisms to monitor fishing and reporting. Otherwise, subsidies to traditional fishermen will be restricted. While it has secured a temporary relief to provide subsidies to grow its fishing fleet, it will have to fight an uphill battle on the issue in future negotiations. In addition, the results of the TRIPS discount are not the same as what it offers.
Overall, the road ahead for India in the WTO is tough. India’s negotiators need to learn lessons from the dynamics in MC12 and do soul-searching to improve the curriculum.
D. Ravi Kant is a journalist based in Geneva. He writes for several publications on global trade issues and developments at the WTO