Consensus, MFN, special and differential treatment in WTO key for global trade balance: Piyush Goyal
Commerce and Industry Minister Piyush Goyal on Saturday said consensus-based decision-making, Most Favoured Nation (MFN) rule-based trade, and special and differential treatment in the WTO are key to ensuring balance in global trade.
He also emphasised the need to uphold the World Trade Organisation’s (WTO) foundational principles.
The minister stated this during his meeting with WTO Reform Minister-Facilitators Espen Barth Eide, Norway’s Minister of Foreign Affairs and Chris Bryant, UK Minister of State for Trade Policy, on the margins of the ongoing 14th ministerial conference of the WTO at Yaounde in Cameroon.
“Reiterated India’s full support for a reformed, relevant, and effective WTO. Emphasised the need to uphold the organisation’s foundational principles, particularly consensus-based decision-making, MFN rule-based trade, and Special and Differential Treatment, which are essential to ensuring equity and balance in global trade,” Goyal said in a social media post.
The four-day ministerial conference (MC) will end on March 29. The MC is the highest decision-making body, which meets once every two years.
WTO is a 166-member Geneva-based body which deals with global trade-related issues. It also adjudicates disputes between the member countries. India is a member since 1995.
WTO reform is a key agenda being pushed by developed countries, particularly the US. India is supporting this but has stated that the core principle of the organisation should not be diluted. The WTO is run by its member Governments. All major decisions are made by the membership as a whole, either by ministers (who meet at least once every two years) or by their ambassadors or delegates (who meet regularly in Geneva). Decisions are normally taken by consensus.
The US is pushing for World reforms and has raised issues with regard to the consensus-based decision-making process. It has been argued that this process slows down decision-making. However, developing economies, including India, is of the view that it ensures equal voices to all members.
The most favoured nation (MFN) principle states that all member countries should be treated equally. Under the WTO agreements, member countries cannot normally discriminate between their trading partners. If a nation extends lower import duty benefits to one of its trading partners, that rate has to be granted to others also. Exceptions are allowed only under a free trade agreement.
Special and differential treatment (S&DT) allows developing and poor (less developed) countries to enjoy certain benefits, including taking longer time for implementing agreements and binding commitments, and measures to increase trading opportunities for them. Currently, any WTO member can designate itself as a developing country and avail these benefits. Some developed nations have stated that self-declaration puts the WTO on a path to failed negotiations and it is also a path to institutional irrelevance.
As part of the proposed WTO reforms, developed countries are saying that developing countries are bypassing rules in the name of self-proclaimed development status in the WTO. On the other hand, developing nations, including India, are demandeurs for special and differential treatment.
