Objectives

 To study the role of WTO in India

 To study the impact of WTO agreement on
India
 To study Geographical Indication
 To study Anti-Dumping Action
 To study role of India in WTO - 2025
Literature Review
 IndiaLaunches Safeguard Investigation
On Saturated Fatty Alcohols:
○ WTO NEWS
 On 19 February 2014, India notified the WTO’s
Committee on Safeguards that it initiated on 13
February 2014 a safeguard investigation on
saturated fatty alcohols.
 Reasons For Initiation Of
Investigation
 The import of Saturated Fatty Alcohols has shown an increasing
trend in absolute terms as well as the relative terms;
 Share of domestic industry in domestic consumption and domestic
demand has fallen significantly;
 Though sale of the domestic industry increased in 2013-14 as
compared to the preceding year 2012-13, it has declined
significantly in comparison to 2010-11;
 Profitability of the domestic industry has steeply deteriorated,
leading to financial losses.
 The Domestic Industry’s petition has been examined as it has been
found that increased imports of the Saturated Fatty Alcohols have
caused or threatening to cause serious injury to the domestic
producers of the Saturated Fatty Alcohols. Accordingly, it has been
decided to initiate an investigation.
 What is a safeguard
investigation?
 A safeguard investigation seeks to determine whether
increased imports of a product are causing, or is
threatening to cause, serious injury to a domestic
industry.
 During a safeguard investigation, importers,
exporters and other interested parties may present
evidence and views and respond to the presentations
of other parties.
 A WTO member may take a safeguard action (i.e.
restrict imports of a product temporarily) only if the
increased imports of the product are found to be
causing, or threatening to cause, serious injury.
 US files dispute against India
over measures relating to solar
cells and solar modules
○ WTO NEWS

 On 11 February 2014, the United States notified

the WTO Secretariat of a request for consultations
with India concerning certain measures relating to
domestic content requirements for solar cells and
solar modules. The measures correspond to Phase
II of the Jawaharlal Nehru National Solar Mission
programme.
 Reasons For A Request For
Calculations
 India adopted this programme to promote development of
solar power generation facilities.
 According to the United States, India requires solar power
developers to purchase and use solar cells and solar
modules of domestic origin.
 The United States adds that solar power developers receive
certain benefits and advantages, such as long term tariffs
for electricity, contingent on their purchase and use of solar
cells and solar modules of domestic origin.
 The claim states that India provides less favourable
treatment to imported solar cells and solar modules that that
accorded to like products originated in India and they are
trade-related investment measures inconsistent with India's
obligations under the GATT.
 What is a request for
consultations?
 The request for consultations formally
initiates a dispute in the WTO.
Consultations give the parties an opportunity
to discuss the matter and to find a
satisfactory solution without proceeding
further with litigation.
 After 60 days, if consultations have failed to
resolve the dispute, the complainant may
request adjudication by a panel.
 Members Start Implementing
Bali Farm Package, As Concerns
Remain About Subsidy Breaches
○ WTO NEWS

 The WTO’s Agriculture Committee began work on

three decisions taken at the December 2013 Bali
Ministerial Conference, when it met on 29 January
2014.
 It also heard questions and answers about countries
actually or possibly breaching their agreed limits
on subsidies i.e. 10% of the agri-GDP.
CNTD…
 A strong political statement to keep export subsidies
low (along with policies with equivalent effects, known
collectively as “export competition”)
 A commitment on how to deal with a certain type of
quota (known as a “tariff quota”) when imports
repeatedly fall significantly below the quota limit
 An agreement that the cost of building up food stocks
by developing country governments, for food security,
need not be counted against the country’s domestic
support limits, provided certain conditions were met.
 Azevêdo calls Bali “a leap
forward in favour of developing
countries”
○ WTO NEWS
 Director-General Roberto Azevêdo, in a speech at the
Confederation of Indian Industry Partnership Summit in
Bangalore on 28 January 2014, said that “besides being
a boost to the WTO as an institution, what we delivered
in Bali has tremendous economic significance and will
improve the lives of millions around the world”.
 He added: “The work has only just begun and we have
the chance to make 2014 the year that the Doha round is
put back on track. It will not be easy, but it is
achievable. I hope that together we can capitalize on the
success in Bali, and seize the opportunity that it has
provided.”
 WTO
 The World Trade Organization (WTO) is a
global international organization dealing
with the rules of trade between nations. The
work of WTO moves around WTO
agreements, negotiated and signed by the
bulk of the world's trading nations and
ratified in their parliaments.
 The goal is to help producers of goods and
services, exporters, and importers conduct
their business.
 Need For WTO
 It helps to contribute towards international peace, by
helping the trade to flow smoothly and dealing with disputes
over trade issues.
 It allows disputes to be handled constructively. With Global
boundaries evading, more and more trade is taking place,
and hence, leading to more chances for disputes. To put forth
to the claim, around 300 cases have been filed since
inception of WTO, and without peaceful and harmonious
way to resolve them, they could have led to a political crisis.
 It is based on rules and has nothing to do with power of the
nation.
 It gives consumers more choice and a broader range of
qualities to choose from.
 The fact that there exists a forum to handle crisis, gives
confidence to nations to do more and more trade, thereby
increasing the income, and stimulating economic growth.
 India And WTO
 India is a founder member of the General Agreement on
Tariffs and Trade (GATT) 1947 and its successor, the
World Trade Organization (WTO), which came into effect
on 1/1/1995 after the conclusion of the Uruguay Round.
 India's participation in an increasingly rule based system
in the governance of international trade is to ensure more
stability and predictability, which ultimately would lead to
more trade and prosperity for itself and the 149 other
nations which now comprise the WTO.
 India also automatically avails of MFN and national
treatment for its exports to all WTO members.
Impact Of WTO Agreements On
Indian Economy

 The signing of WTO agreements will have far

reaching effects not only on India’s foreign trade
but also on its internal economy.
 Although the ultimate goal of WTO is to free
world trade in the interest of all nations of the
world, yet in reality the WTO agreements has
benefitted the developed nations more as
compared to developing ones.
 Positive
Impacts/Benefits /Advantages /Gains
from WTO

 Increase in Export Earnings:

 Estimates made by World Bank, International
Monetary Fund (IMF) and the WTO Secretariat,
shows that the income effects of the
implementation of the Bali Round package will be
an increase in traded merchandise goods. It is
expected that India’s share in world exports would
improve.
CNTD…
 Agricultural Exports:
 Reduction of trade barriers and domestic subsidies
in agriculture is likely to raise international prices
of agricultural products. India hopes to benefit from
this in form of higher export earnings from
agriculture. This seems to be possible because all
major agriculture development programmes in
India will be exempted from the provisions of
WTO Agreement.
CNTD…
 Export of Textiles and Clothing:
 With the phasing out of MFA (Multi - Fibre
Arrangement), exports of textiles and clothing
increased and this will be beneficial for India. The
developed countries demanded a 15 year period of
phasing out of MFA, the developing countries,
including India, insisted that it should be done in 10
years. The Uruguay Round accepted the demand of the
latter. But the phasing out Schedule favoured the
developed countries because a major portion of quota
regime was removed only in the tenth year, i.e. 2005.
The removal of quotas benefited not only India but also
every other country.
CNTD…
 Multilateral Rules and Disciplines:
 The Uruguay Round Agreement has strengthened
multilateral rules and disciplines. The most
important of these relate to anti - dumping,
subsidies and countervailing measures, safeguards
and disputes settlement. This is likely to ensure
greater security and predictability of the
international trading system and thus create a
more favourable environment for India in the New
World Economic Order.
CNTD…
 Growth to Services Exports:
 Under GATS agreement, member nations
have liberalised service sector. India benefits
from this agreement.
 E.g. India’s services exports have increased
from about 5 billion US $ in 1995 to 143.5
billion US $ in 2012-13.
CNTD…
 Foreign Investment:
 India has withdrawn a number of measures against
foreign investment, as per the commitments made
to WTO. As a result of this, foreign investment
and FDI has increased over the years. A number of
initiatives have been taken to attract FDI in India
between 2000 and 2002. In 2012-13, the net FDI
in India was US $ 24 billion.
 Negative Impacts /
Problems /Disadvantages of WTO
Agreements on Indian Economy
 TRIPs:
 The Agreement on TRIPs at Uruguay Round
weighs heavily in favour of Multinational
Corporations and developed countries as they
hold a very large number of patents. Agreement
on TRIPs will work against India in several ways
and led to monopoly of patent holding MNCs. As
a member of WTO, India has to comply with
standards of TRIPs.
CNTD…
 Trade Facilitation:
 The Bali package includes provisions for lowering
import tariffs and agricultural subsidies, which
some expect will make it easier for developing
countries to compete with the developed world in
global markets.
 Developed countries would abolish hard import
caps on agricultural products from the developing
world, instead being only allowed to charge tariffs
on amount of agricultural imports exceeding
specific limits.
 Another important target is reforming customs
bureaucracies and formalities to facilitate trade.
 The Negative Impact Of Agreement
On Trips On Indian Economy
 Pharmaceutical Sector:
 Under the Patents Act, 1970, only process patents were granted
to chemicals, drugs and medicines.
 This means an Indian pharmaceutical company only needed to
develop and patent a process to produce and sell that drug.
 This proved beneficial to Indian pharmaceutical companies as
they were in a position to sell quality medicines at low prices
both in domestic as well as in international markets.
 However, under the agreement on TRIPs, product patents needs
to be granted.
 This will benefit the MNCs and it is feared that they will
increase the prices of medicines heavily, keeping them out of
reach of poor.
 Again many Indian pharmaceutical companies may be closed
down or taken over by large MNCs.
CNTD…
 Agriculture:
 The Agreement on TRIPs extends to agriculture
through the patenting of plant varieties.
 This may have serious implications for Indian
agriculture.
 Patenting of plant varieties may transfer all gains in the
hands of MNCs which will be in a position to develop
almost all new varieties with the help of their huge
financial resources and expertise.
CNTD…
 Microorganisms:
 The Agreement on TRIPs also extends to
Microorganisms as well.
 Research in microorganisms is closely linked with
the development of agriculture, pharmaceuticals
and industrial biotechnology.
 Patenting of microorganisms will again benefit
large MNCs as they already have patents in
several areas and will acquire more at a much
faster rate.
CNTD…
 TRIMs:
 Agreement on TRIMs provides for treatment of foreign
investment on par with domestic investment.
 This Agreement too weighs in favour of developed
countries.
 There are no provisions in Agreement to formulate
international rules for controlling restrictive business
practices of foreign investors.
 In case of developing countries like India, complying
with Agreement on TRIMs would mean giving up any
plan or strategy of self reliant growth based on locally
available technology and resources.
CNTD…
 GATS:
 One of the main features of Uruguay Round was the
inclusion of trade in services in negotiations.
 This too will go in favour of developed countries.
 Under GATS agreements, the member nations have to
open up services sector for foreign companies.
 The developing countries including India have opened
up services sector in respect of banking, insurance,
communication, telecom, transport etc. to foreign
firms.
 The domestic firms of developing countries may find
it difficult to compete with giant foreign firms due to
lack of resources & professional skills.
CNTD…
 Non - Tariff Barriers:
 Several countries have put up trade barriers and non-
tariff barriers following the formation of WTO.
 This has affected the exports from developing
countries.
 The Union Commerce Ministry has identified 13
different non - tariff barriers put up by 16 countries
against India.
 E.g. MFA (Multi - fibre arrangements) put by USA
and European Union is a major barrier for Indian
textile exports.
CNTD…
 Agreement on Agriculture (AoA):
 The AoA is biased in favour of developed
countries.
 The issue of food security to developing countries
is not addressed adequately in AoA.
 The existence of global surplus of food grains does
not imply that the poor countries can afford to buy.
 The dependence on necessary item like food grains
would adversely affect the Balance of Payment
position.
CNTD…
 Inequality within the Structure of WTO:
 There is inequality within the structure of WTO
because the agreements and amendments are in
favour of developed countries.
 The member countries have to accept all WTO
agreements irrespective of their level of economic
development.
CNTD…
 LDC Exports:
 The 6th Ministerial Conference took place at Hong Kong in
December 2005.
 In this Conference, it was agreed that all developed country
members and all developing countries declaring themselves
in a position to do so, would provide duty - free and quota-
free market access on a lasting basis to all products
originating from all Least Developed Countries (LDCs).
 India has agreed to this. Now, India's export will have to
compete with cheap LDC exports internationally. Not only
this, the cheap LDC exports will come to Indian market and
compete with domestically produced goods.
CNTD…
 Agricultural Subsidy Programme
 According to Agreement of Agriculture (AoA)
proposed by WTO, the member countries are required
to maintain the price-support-based food subsidy de
minimis 10% of the agri-GDP.
 However, if the Indian Government implements the
Food Security Act, 2013, its agri-subsidies will
certainly increase above 10%.
 Because the subsidies level was fixed on prices
prevailing in 1986-88 and thus, need to reflect the
current prices that have gone up substantially since
then.
CNTD…
 India will face several problems in the process of
complying with WTO agreements, but it can also
reap benefits by taking advantage of changing
international business environment.
 For this, it needs to develop and concentrate on
its areas of core competencies.
 Protecting the Geographical
Indication for Darjeeling Tea
 This issue relates to the geographical indication
(GI) protection of Darjeeling tea due to the
unauthorized use and registration of ‘Darjeeling
and Darjeeling logo’ by International Tea KK, a
Japanese company, already registered in Japan by
the Tea Board of India.
 The issue also refers to the unauthorized use and
attempted registration of the words ‘Darjeeling
and Darjeeling logo’ by some other countries like
France, Russia, United States, Germany, Israel,
Norway and Sri Lanka.
CNTD…
 In order to deal with the situations described
ahead, India, along with several other member
countries of the WTO, wants to extend the
proposed register for GI to include products or
goods, other than wines and spirits, which may be
distinguished by the quality, reputation or other
characteristics essentially attributable to their
geographical origin.
CNTD…
 The Doha Ministerial Declaration under
paragraphs 12 and 18 also provides a mandate for
the issue of providing a higher level of protection
to GIs to products other than ‘wines and spirits’ to
be addressed by the TRIPS Council.
 During the last four years the Tea Board of India
has spent approximately US$200, 000 for legal
and registration expenses, costs of hiring an
international watch agency and fighting
infringements in overseas jurisdictions.
 The Indian Shrimp Industry
Organizes to Fight the Threat of
Anti-Dumping Action

 This issue deals with the way in which the Indian

shrimp industry responded when faced with an
anti-dumping action in the United States.
 It also indicates the potential impact of the anti-
dumping action on the fragmented, small-
producers-dominated industry.
CNTD…
 The Ad Hoc Shrimp Trade Action Committee
(ASTAC), an association of shrimp farmers in
southern states of the United States, filed an anti-
dumping petition against six countries — Brazil,
China, Ecuador, India, Thailand and Vietnam.
 The import duty for India is 14.2%, for China is
49.09%, for Brazil 36.91%, for Vietnam 16.01%,
for Ecuador 7.3% and for Thailand 6.39%
decided by the US Department Of Commerce.
 Role of India in WTO - 2025
 According to the WTO Secretariat Report, along with the
policy statement by the Government of India, India is
expected to snatch most of the business deals that are
presently catering the developed nations which includes major
service based industries like telecom, financial services,
infrastructure services such as transport and power.
 The increase in availability and reduction in tariffs has
prompted many developed nations to go for business with
India especially in IT & ITeS industry.
 If the trend continues then by 2025, India is expected to cater
to the software and services demands of major giants of the
business world.
 Analyzing the present relationship with the promising
economic growth of India, one can be sure that India is going
to enjoy a very candid and bright relationship with WTO and
associated member nations by 2025.
Immigration Laws & Trade Barriers
 India, which is going through a phase wherein the immigration
laws act as a barrier in free movement of professionals from
developing countries, would play a major role in setting up of an
immigration law which would be of more profit to the
developing countries.
 Services Sector boom in India has forced it to think on the lines
of coming up with a immigration law wherein much issues will
not exist in free movement of individuals, and with India being a
giant amongst IT and ITeS Services Sector, is expected to lead
the way in bringing about this change.
 India has aligned itself with WTO in the goal to reduce the trade
barriers and tariffs to zero by 2025. This will help in
liberalization process of India and also help other developing
countries become economically strong by 2025.
Pharmaceutical Sector
 India has had a growing pharmaceutical sector and in
another 20 years, it would be one of India's leading
sectors.
 It has been able to produce low cost, high quality
drugs, and hence, India, along with WTO, would
play a major role towards making the right drugs
available at the right time in under-developed
economies.
 India exports a modest $ 290 million in Africa which
is approximately around 2 per cent of its total
market.
 With Pharmaceutical Sector gaining pace, this
market share is bound to increase.
 Multilateral Trade
 There is a trend towards unilateral action by
certain developed countries in total disregard of
provisions laid down in the Uruguay Round
Agreements.
 India has always been trying to take such issues
to dispute settlement mechanism.
 India will be at the helm of required measures
to stop such activities from taking place, and
thereby help in bringing a system of multilateral
trading which would be in favour of the
developing countries.
CNTD…
 Distinguished delegates are aware that
developing countries and least-developed
countries have to battle against resource
constraints and shortage of skills and expertise in
these areas. Such unilateral actions will be
brought to disrepute the entire multilateral
trading system.
 Another important issue has been an increasing
trend in recent past in favour of regionalism such
as EU, ASEAN, etc...
 Protection of Biodiversity &
Traditional Knowledge
 India has been actively pursuing the
implementation of the convention on biological
diversity.
 By 2025, India would be at the fore-front of
bringing about changes in the ‘Protection of
Biodiversity and Traditional Knowledge’, by
taking various measures.
 It would be able to take the measures like using
Intellectual Property Rights to prevent traditional
knowledge, prior informed consent and
supplemental means for benefit sharing like
contractual arrangement.
 Agriculture
 Agriculture employs over 70 per cent of the
labour force in low-income countries, 30 per
cent in middle-income countries and only 4
per cent in high-income countries.
 Rapid growth of agriculture is essential for
ensuring food security and alleviation of
poverty.
CNTD…
 In 2025, India is expected to be self-sufficient in
the food grain production. India has good
agricultural land, which is still not getting used.
 Most of the agriculture is done in the north India,
but in the northern east and southern part, not
much attention is given.
 If India is able to use this land properly, then the
production will be enough in order to meet
domestic consumption and also India will be
helping other countries by exporting these.
 Services Sector & Reforms
 In next two decades, services will dominate the
economic activities of countries at virtually every stage
of development, making services trade liberalization is a
necessity for the integration of the world economy.
 As of now, in many developing nations, like India, the
service sector is single largest contributor to economic
output, ahead of both agriculture or industry.
 Even allowing for the fact that governments are major
service providers (education, healthcare, sanitation,
etc.), the commercial market for services is huge and
growing in virtually every country.
 The trend is very clear, as international economies
develop and incomes rise, the commercial service sector
accounts for an ever-larger share of GDP.
CNTD…
 This sector is less infrastructure- (and capital)
intensive than traditional manufacturing sectors.
By 2025, it is expected that this sector will
employ at least 3 million people and generate
export revenues of US$ 50 billion, representing
about 8 per cent of the global IT services
outsourcing market.
Era of US-India Relations, 2025
 India's voice carries weight and credibility in
many areas of world and many developing
countries would look at India as a leader in major
global issues.
 The close relationship between India and US
towards the development of such countries,
would lead a new era of US-India Relations - into
reality.
 Conclusion
 Trade is an engine for growth. In the past this engine has
sputtered due to India’s policies rather than its geography.
 The challenges ahead for India now lie in implementing
sound domestic policies that increase competition in, and
improve the contestability of, domestic markets.
 However, active multilateral engagement can be
incrementally helpful in facilitating domestic reform and
gaining access for India’s exports of goods and labor
services.
 India needs to develop a proactive approach rather than a
defensive approach to benefit from the changing
environment under WTO.
 The voice of the developing countries needs to be heard so
that the benefits and the risks associated with increased trade
are clear and there is no undermining of national efforts to
develop.
Thank
You