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Doha concerns confined to farming sector: Singh

NEW DELHI — India's Prime Minister Manmohan Singh told US President George W. Bush that the country's concerns over the Doha round of trade talks are confined to agriculture, indicating compromise on issues such as services.

"India can by and large live with what is on the table and has concerns only on agriculture,'' Singh told Bush in a telephone conversation last night. "We will try to help in reaching a compromise.''

Singh's statement may set the tone for a meeting this week among the leaders of India, South Africa and Brazil, which the US wants to lead to an agreement on industrial tariff cuts. The three nations and other African and Latin American countries have complained that the current negotiating framework would require them to make deeper cuts in their industrial tariffs than the US, the European Union and other developed nations.

The focus of the Doha round of talks, which started in late 2001, centred on agriculture and shifted to industrial tariffs this year after the US and the EU got close to an agreement on a formula for agriculture subsidy and tariff cuts.

Don Stephenson, Canada's ambassador to the WTO, proposed a formula of industrial tariff cuts that would cap duties as high as 23 per cent in developing countries and 9 per cent in the US and the EU. The developing nations said the proposal "cannot be accepted.''

US negotiators argue the tariffs in developing countries could still remain more than twice as high as those in the rich nations and wouldn't force large cuts in their actual tariffs because of gaps between WTO caps and actual duties.

Offering compromise

The South Asian nation may be willing to yield on some demands in return for concessions in other areas, said D.H. Pai Panandiker, president of the RPG Foundation, an economic policy group based in New Delhi. India is offering a quid-pro-quo kind of compromise, cutting import duties and asking for reduction in subsidies offered by the US to its farmers,'' Panandiker said in a telephone interview.

Indian negotiators have previously demanded better access for qualified professionals to work abroad through the talks on commercial services. India has been seeking an agreement in services that would give professionals easier access to temporary work permits in places such as the EU and the US. "India will not subscribe to any World Trade Organisation negotiation conclusion without a satisfactory outcome in services,'' Trade Minister Kamal Nath had said in May.

Talks on Services

Trade in services includes foreign investment in areas such as banking, express delivery and telecommunications. It also includes rules for granting short-term entry visas to professional workers, according to the WTO. The US has in the past demanded that India allow overseas insurers a bigger stake in joint ventures. The Indian government, which limits foreign insurers' stakes at 26 per cent, has promised to raise the limit to 49 per cent.

Singh will instruct Nath to work on reaching a compromise, according to the release issued late yesterday by the Indian government after the conversation between the two leaders. India remains committed to the successful conclusion of the Doha Round at an early date,'' Singh told Bush.

Singh, however, insisted the government would not compromise on its demands on farming. More than half of India's 1.1 billion population depend on agriculture for their living. India needs protection through "special products and safeguards on which we need greater clarity,'' Singh told Bush. "This is not yet there and this issue is critical for India.''

Stand on Farming

The stand on farming could lead to a deadlock in the negotiations, Panandiker said. "The talks are heading toward a failure as both the countries have taken a hard position,'' he said. "The US doesn't seem to be yielding from its position.''

The Indian government won't give up on agricultural issues as the ruling federal coalition doesn't want to lose political points, said N. Bhaskara Rao, chairman of the Centre for Media Studies, a policy research group in New Delhi. "You cannot ignore the agricultural issues when a substantial part of your electorate depends on it for their livelihood,'' Rao said. "From India's point of view, farm issues will play a pivotal role in the WTO talks.'' The Doha round of global trade talks under the WTO is designed to add billions of dollars to the world economy and alleviate poverty.

Draft Text

The draft texts in circulation could be the basis for discussions toward an "agreed outcome in agriculture and industrial tariffs,'' Singh said. "Although there are grey areas in the text and specific numbers which need to be agreed upon, the texts give broad indications of the range of possibilities on most issues.''

The WTO on July 17 published proposals that would slash customs duties on goods ranging from beef to auto parts and cut spending on US farmers, in a last-ditch effort to reach an accord this year. Singh's remarks came in a conversation during which he told Bush that the Indian government was facing "difficulties'' in making progress on the civilian nuclear agreement with the US, following domestic opposition.