WTO: India must cut tariff to revive talks,says US

The United States has handed over a list of industrial products such as chemical, health care and industrial engineering items to India, China and Brazil, saying the three emerging countries must agree to eliminate tariffs on these items for any further progress in the stalled Doha trade negotiations, analysts said.

During separate bilateral meetings with Brazil and India in Paris last week, the US conveyed that it was the responsibility of emerging countries to convince their trade and other lobbies on a zero-for-zero tariff elimination for these products, failing which Washington would find it difficult to secure the green light from its powerful industrial and Congressional groups to conclude the Doha talks, Business Standard was told.

The US, which already concluded its bilateral meeting with China before the Paris meeting, appeared pretty inflexible that the three big emerging countries must provide sufficient market access on these industrial products as well as some agriculture items, for the sacrifices it was going to make in reducing its farm subsidies, sources said.

China, however, categorically rejected the US' demand while India said there is no need for such a treatment as the tariffs on these items are at historic lows enabling the American industry to have a sizeable export presence.

Brazil, which recently carried out a study by an American trade research outfit on the implications of the tariff elimination on chemicals on its industry, gave a mixed signal.

The three emerging countries also made it known that the Doha mandate could not be altered just to enable the American industry to have best of the results from the negotiations.

The Doha mandate, which was agreed in 2001 and later modified in 2004 and 2005, allows sectoral talks only on voluntary, non-mandatory basis. But the US wants to convert the talks into a "plurilateral agreement" limited only to the leading emerging countries and not the entire WTO membership, analysts said.

The Paris talks were not intended to bring any immediate breakthrough and if anything, they were aimed at exchanging ideas and whether those ideas were feasible, said one participant at the meetings.

"There is no traction in these talks," said the participant, suggesting that the US had a long way before it could enter some hard bargaining.

Analysts in Washington said the US was not in a position to make up its mind until it knows the outcomes on its health reform and climate change talks.

In Paris, the US delegation was headed by Matt Rohde, assistant US trade representative for WTO and multilateral affairs, while the Indian team was led by Dinesh Kumar Mittal, the additional secretary in the Indian trade ministry.

While the US and Brazil seem to have limited or no areas of differences in agriculture, the former continues to have several unresolved issues with China and India on the special safeguard mechanism flexibility.