India and Brazil have opposed tooth and nail the tariff reduction formula proposed by the United States and European Union at the World Trade Organisation with the just concluded agriculture negotiations ending without making any headway.
The two developing countries indicated that they are working on an alternative approach to reduce tariffs.
The formula which India and Brazil are working on is likely to draw from the elements of the formula floated by Stuart Harbinson, former chairman of agriculture committee at WTO, reports quoting diplomatic sources said.
The US and the EU have been insisting on the blended formula for reducing tariffs, which was a part of the draft framework floated at the failed WTO ministerial meeting at Cancun (Mexico) in September last year.
The US-EU formula could mean, depending on what numbers are eventually inserted into the formula, that developing countries, along with developed ones, would have to lower their tariffs and open their markets to competition.
From the US' and the EU's point of view, these concessions were necessary if they are to dismantle their domestic subsidy programme.
The US had previously turned down the Harbinsons' formula, which, it felt, would not force developing countries to reduce their tariffs as much as the developed countries.
However, at the just concluded talks on agriculture in Geneva, there were some indications of growing support for a tariff reduction formula that would at least include some aspects of Harbinson's formula, reports said.
With the agri-negotiations in Geneva having failed to make any headway, the entire responsibility for narrowing the differences between developed and developing countries on the contentious export subsidy in agriculture rests on the meeting of the key trade ministers called by US Trade Representative Robert Zoellick this week in London.
Trade Ministers from EU, Brazil, South Africa, Mexico and India's Divestment Minister Arun Shourie will attend the meeting which will attempt to break the deadlock in trade talks and prepare ground for readying a broad framework by July.
