CHAPTER 1 INTRODUCTION: The WTO was born out of negotiations, and everything the WTO does is the result

of negotiations. The bulk of the WTOs current work comes from the 198694 negotiations called the Uruguay Round and earlier negotiations under the General Agreement on Tariffs and Trade (GATT). The WTO is currently the host to new negotiations, under the Doha Development Agenda launched in 2001. Trade relations often involve conflicting interests. Agreements, including those painstakingly negotiated in the WTO system, often need interpreting. The most harmonious way to settle these differences is through some neutral procedure based on an agreed legal foundation. That is the purpose behind the dispute settlement process written into the WTO agreements. While the WTO is driven by its member states, it could not function without its Secretariat to coordinate the activities. The Secretariat employs over 600 staff, and its experts lawyers, economists, statisticians and communications experts assist WTO members on a daily basis to ensure, among other things, that negotiations progress smoothly, and that the rules of international trade are correctly applied and enforced 155 members on 10 May 2012. GATT is now the WTOs principal rule-book for trade in goods. The Uruguay Round also created new rules for dealing with trade in services, relevant aspects of intellectual property, dispute settlement, and trade policy reviews. The complete set runs to some 30,000 pages consisting of about 30 agreements and separate commitments (called schedules) made by individual members in specific areas such as lower customs duty rates and services marketopening.

ME ANI NG: India is one

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of the foun ding mem bers of WT O whic h came into exist ence on Janu ary 01, 1995 repla cing GAT T (Gen eral Agre emen t on Tarif fs and Trad e) and prom ising the heral d of new era in the rule base d syste m of
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gove rning and prom oting inter natio nal trade conc omit ant with the need s of the ongoin g proce ssor globa lizati on. Wher e count ries have faced trade barri ers and want ed them lowe red, the negot iatio ns have helpe d to open
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mark ets for trade . But the WT O is not just about openi ng mark ets, and in some circu msta nces its rules supp ort main taini ng trade barri ers for exam ple, to prote ct cons umer s or preve nt the sprea d of disea se. At
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its heart are the WT O agree ment s, negot iated and signe d by the bulk of the worl ds tradi ng natio ns. Thes e docu ment s provi de the legal grou nd rules for inter natio nal com merc e. They are essen tially contr acts,
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bindi ng gove rnme nts to keep their trade polic ies withi n agree d limit s. Alth ough negot iated and signe d by gove rnme nts, the goal is to help prod ucers of good s and servi ces, expo rters, and impo rters cond uct their busin ess,
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while allow ing gove rnme nts to meet socia l and envir onme ntal objec tives. Trad e relati ons often invol ve confl ictin g inter ests. Agre emen ts, inclu ding those pains takin gly negot iated in the WT O syste m, often need inter preti
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ng. The most harm onio us way to settle these differ ences is throu gh some neutr al proce dure base d on an agree d legal foun datio n. That is the purp ose behin d the dispu te settle ment proce ss writt en into the WT O agree
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ment s. Ther e are a num ber of ways of looki ng at the Worl d Trad e Orga nizati on. It is an orga nizati on for trade openi ng. It is a foru m for gove rnme nts to negot iate trade agree ment s. It is a place for them
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to settle trade dispu tes. It opera tes a syste m of trade rules. Esse ntiall y, the WT O is a place wher e mem ber gove rnme nts try to sort out the trade probl ems they face with each other . The WT O agree ment s are lengt
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hy and comp lex beca use they are legal texts cover ing a wide range of activi ties. But a num ber of simpl e, fund amen tal princ iples run throu ghou t all of these docu ment s. Thes e princ iples are the foun datio n of the multi
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latera l tradi ng syste m

WH AT WT O STA NDS FOR AND WH AT WT O DO: Ther e are a num ber of ways of looki ng at the Worl
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d Trad e Orga nizati on. It is an orga nizati on for trade openi ng. It is a foru m for gove rnme nts to negot iate trade agree ment s. It is a place for them to settle trade dispu tes. It opera tes a syste m of trade rules. Esse ntiall y,
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the WT O is a place wher e mem ber gove rnme nts try to sort out the trade probl ems they face with each other . The WT O agree ment s are lengt hy and comp lex beca use they are legal texts cover ing a wide range of
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activi ties. But a num ber of simpl e, fund amen tal princ iples run throu ghou t all of these docu ment s. Thes e princ iples are the foun datio n of the multi latera l tradi ng syste m The WT O is run by its mem ber
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gove rnme nts. All majo r decis ions are made by the mem bersh ip as a whol e, eithe r by minis ters (who usual ly meet at least once every two years ) or by their amba ssado rs or deleg ates (who meet regul arly in Gene va). Whil
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e the WT O is drive n by its mem ber states , it could not funct ion with out its Secre tariat to coor dinat e the activi ties. The Secre tariat empl oys over 600 staff, and its exper ts lawy ers, econ omist s, statis tician s and com muni catio ns
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exper ts assist WT O mem bers on a daily basis to ensur e, amon g other thing s, that negot iatio ns progr ess smoo thly, and that the rules of inter natio nal trade are corre ctly appli ed and enfor ced It is a 149mem ber orga
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nizati on with Pasc al Lam ay as its head. It repre sents all the tradi ng natio ns of the worl d, who impo rtexpo rt good s & servi ces. Creat ed on Jan1, 1995 , it was consi dered the bigge st refor m in trade since WWI I. Its
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prede cesso r, GAT T (Gen eral Agre emen t on Tarif f & Trad e), had a tumu ltuou s 47 years histo ry. GAT T made a begin ning in 1948 , and provi ded a fram ewor k for trade expa nsion vis-vis remo ving barri ers on free move
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ment of good s and servi ces. It provi ded platf orm for 8 trade negot iatio ns in its chec kered histo ry until 1994 , the last trade negot iatio ns the Urug uay Roun d, result ed in the creati on of WT O. In each of these Rou nds
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(high level negot iatio ns), the West , mostl y Euro pe, Japa n and Nort h Ame rica negot iated trade deals with them selve s in mind . The devel opin g worl d inclu ding India , Chin a, most of Afric a and Latin Ame rica
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were forgo tten as back ward and with out any clout . For Exa mple , the Kenn edy Roun d of 1963 quad ruple d the worl d trade . At that time India and Chin a had not emer ged and henc e did not figur e in the worl d trade talks. Toky
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o Roun d of 1973 -79 quad ruple d the alrea dy quad ruple d worl d trade in last 25 years . In each case tariff s and trade disto rting subsi dies were progr essiv ely reduc ed on indus trial good s & servi ces. The West enjoy ed unpr
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eced ented prosp erity. US & Japa n were the bigge st gaine rs, follo wed by the all the natio ns of the Euro pe. Poor count ries staye d poor. Nobo dy spok e on their behal f, and they had no clout to make their prese nce felt.
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Ther e are simpl e reaso ns for that. First, the poor count ries had no mone y to comp ete in the inter natio nal mark et with quali ty good s, seco nd subsi dies provi ded by the natio ns to enco urage devel opme nt after WWI I
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made their prod ucts much chea per. Henc e a die was cast for poor to stay poor. In 1982 , Chin a burst on the inter natio nal trade scene . In 2002 , India beca me an upco ming star for the worl d to take note. Henc e a new
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trade body was need ed to regul ate and enco urage trade . Henc e at the Urug uay Roun d, a decis ion was taken to set up a new body (WT O) to mana ge the grow ing trade . TRA DE NEG OTI ATI ONS : The WT
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O agree ment s cover good s, servi ces and intell ectua l prop erty. They spell out the princ iples of liber alizat ion, and the perm itted exce ption s. They inclu de indiv idual count ries com mitm ents to lowe r custo ms tariff s
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and other trade barri ers, and to open and keep open servi ces mark ets. They set proce dures for settli ng dispu tes. Thes e agree ment s are not static ; they are reneg otiate d from time to time and new agree ment s can be adde
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d to the pack age. Man y are now being negot iated unde r the Doha Deve lopm ent Agen da, launc hed by WT O trade minis ters in Doha , Qatar , in Nove mber 2001 . IMP LE ME NTA TIO N AND MO NIT ORI NG: WT
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O agree ment s requi re gove rnme nts to make their trade polic ies trans paren t by notif ying the WT O about laws in force and meas ures adopt ed. Vari ous WT O coun cils and com mitte es seek to ensur e that these requi
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reme nts are being follo wed and that WT O agree ment s are being prop erly impl emen ted. All WT O mem bers must unde rgo perio dic scruti ny of their trade polic ies and pract ices, each revie w conta ining repor ts by the count ry
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conc erned and the WT O Secre tariat . DIS PUT E SET TLE ME NT: The WT Os proce dure for resol ving trade quarr els unde r the Disp ute Settl emen t Unde rstan ding is vital for enfor cing the rules and there fore
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for ensur ing that trade flows smoo thly. Coun tries bring dispu tes to the WT O if they think their right s unde r the agree ment s are being infrin ged. Judg ment s by speci ally appoi nted indep ende nt exper ts are base d on inter preta tions of
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the agree ment s and indiv idual count ries com mitm ents. The syste m enco urage s count ries to settle their differ ences throu gh cons ultati on. Faili ng that, they can follo w a caref ully mapp ed out, stage -bystage proce dure that
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inclu des the possi bility of a rulin g by a panel of exper ts, and the chan ce to appe al the rulin g on legal grou nds. Conf idenc e in the syste m is born e out by the num ber of cases brou ght to the WT O arou nd 300 cases
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in eight years comp ared to the 300 dispu tes dealt with durin g the entir e life of GAT T (194 7 94). BUI LDI NG TRA DE CAP ACI TY: WT O agree ment s conta in speci al provi sion for devel opin g count
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ries, inclu ding longe r time perio ds to impl emen t agree ment s and com mitm ents, meas ures to incre ase their tradi ng oppo rtunit ies, and supp ort to help them build their trade capa city, to handl e dispu tes and to impl emen
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t techn ical stand ards. The WT O orga nizes hund reds of techn ical coop erati on missi ons to devel opin g count ries annu ally. It also holds nume rous cours es each year in Gene va for gove rnme nt offici als. Aid for Trad
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e aims to help devel opin g count ries devel op the skills and infra struct ure need ed to expa nd their trade .

WT O IS MO RE BEN EFI CIA L FOR LES S DEV ELO PED CON TRI ES: Givi ng them more
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time to adjus t, great er flexi bility and speci al privil eges; over three quart ers of WT O mem bers are devel opin g count ries and count ries in transi tion to mark et econ omie s. The WT O agree ment s give them
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transi tion perio ds to adjus t to the more unfa milia r and, perha ps, diffic ult WT O provi sions . OUT REA CH: The WT O main tains regul ar dialo gue with nongove rnme ntal orga nizati ons, parli amen taria ns, other inter
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natio nal orga nizati ons, the medi a and the gener al publi c on vario us aspec ts of the WT O and the ongo ing Doha negot iatio ns, with the aim of enha ncing coop erati on and incre asing awar eness of WT O activi ties.
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GO ODS : It all bega n with trade in good s. From 1947 to 1994 , GAT T was the foru m for negot iatin g lowe r custo ms duty rates and other trade barri ers; the text of the Gene ral Agre emen t spelt out
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impo rtant rules, parti cular ly nondiscri mina tion. Since 1995 , the updat ed GAT T has beco me the WT Os umbr ella agree ment for trade in good s. It has anne xes deali ng with speci fic secto rs such as agric ultur e and
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textil es, and with speci fic issue s such as state tradi ng, prod uct stand ards, subsi dies and actio ns taken again st dum ping. SER VIC ES: Bank s, insur ance firms , telec omm unica tions comp anies , tour opera tors, hotel
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chain s and trans port comp anies looki ng to do busin ess abroa d can now enjoy the same princ iples of freer and fairer trade that origi nally only appli ed to trade in good s. Thes e princ iples appe ar in the new Gene ral Agre
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emen t on Trad e in Servi ces (GA TS). WT O mem bers have also made indiv idual com mitm ents unde r GAT S statin g whic h of their servi ces secto rs they are willi ng to open to forei gn comp etitio n, and how open those mark
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ets are. INT ELL ECT UAL PRO PER TY: The WTO s intelle ctual prope rty agree ment amou nts to rules for trade and invest ment in ideas and creati vity. The rules state how copyri ghts, patent s, trade marks , geogr aphic al names used to
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identi fy produ cts, indust rial desig ns, integr ated circuit layout desig ns and undis closed infor matio n such as trade secret s intell ectual prope rty shoul d be protec ted when trade is involv ed. The India n paten t law is unde r
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revie w for bring ing it in conf ormit y with WT O provi sions . A parti cular part of Artic le 27 ment ioned belo w has direc t impli catio ns for agric ultur e. Even the prod uct paten t aspec t will have impli catio ns for
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agric ultur e by way of prote ction to the inven tors of new agric ultur al prod ucts. Since proce sses are easy to copy, prod uct paten ts are neces sary. The provi sion of TRIP s need to be stren gthen ed to inclu de (a) micr o
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orga nism s but exclu de life form s b) regist ratio n syste m of grass roots inno vatio ns (unli ke utilit y paten t syste m, this regist ratio n syste m shoul d be like prod uct paten t for ten years just as Austr alian inno vatio n
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syste m has been prop osed (c) wide sprea d paten t searc h facili ty for educ ation al and entre prene urial netw orks and cente rs so that quali ty of resea rch and educ ation can be comp etitiv e, (d) just as a globa l regist
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ry has been prop osed for wine s unde r TRIP S, India must insist that simil ar globa l regist ry must exist for green small inno vatio ns too.

CH AP TE R2
IMP ORT ANC E OF INDI AN AGR ICU LTU RE:
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Agri cultu re form s the back bone of the India n econ omy. This secto r contr ibute s to the India n econ omy in a varie ty of ways :

It

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The count ry has made signi fican t impr ovem ents in agric ultur al prod uctio n, but the achie veme nts have been main ly confi ned to a few areas . The majo r chall enge s for our agric ultur e syste m
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woul d alwa ys be incre asing prod uctio n and prod uctiv ity to ensur e food secur ity for the risin g popu latio n. Meet ing this chall enge mean s also ensur ing food secur ity and a bette r stand ard of livin g for
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the rural peopl e. India s perfo rman ce in agric ultur e affec ts overa ll rural devel opme nt and the exten t of rural pove rty. Ther efore , the perfo rman ce of the econ omy is cruci ally depe ndent upon that of agric ultur e.

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ITS ME MB ERS : Whil e the WT O is drive n by its mem ber states , it could not funct ion with out its Secre tariat to coor dinat e the activi ties. The Secre tariat empl oys over 600 staff, and its exper ts lawy ers, econ omist s,
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statis tician s and com muni catio ns exper ts assist WT O mem bers on a daily basis to ensur e, amon g other thing s, that negot iatio ns progr ess smoo thly, and that the rules of inter natio nal trade are corre ctly appli ed and enfor
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ced 155 mem bers on 10 May 2012 . India 1 Janu ary 1995

CON CEP T OF WT O ARI SES:

1 T 1 1 1
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 1 1 1 1 1 1 1 1 1 1 1 1 1

THE URU
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GUA Y ROU ND: T he Urug uay Roun d (198 6-94) is consi dered by both its defen ders and its critic s as a majo r land mark in inter natio nal trade negot iatio ns. It has chan ged the terms of the worl d trade
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regi me in many signi fican t ways . In this roun d, besid es negot iatio n areas of tariff and nontariff meas ures, three new areas were touch ed: 1. Tr ad e in ser vic es, 2. Tr ad e rel ate d in ve st
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me nt me as ur es (T RI M S), 3. Tr ad e rel ate d int ell ect ual pr op ert y rig hts (T RI PS )

Thro ugh these agree ment s, WT O mem bers opera te a nondiscri mina tory
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tradi ng syste m that spell s out their right s and their oblig ation s. Each count ry recei ves guara ntees that its expo rts will be treate d fairly and consi stentl y in other count ries mark ets. Each prom ises to do the same for impo
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rts into its own mark et. The syste m also gives devel opin g count ries some flexi bility in impl emen ting their com mitm ents. The Urug uay Roun d also persi sts with this trend , such as in the gove rnme nt proc urem ent
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code or the infor mati on techn olog y agree ment . In the gove rnme nt proc urem ent negot iatio ns, India is an obser ver, but not a signa tory. In the final Urug uay Roun d pack age, such GAT Tplus, agree ment s are calle d Pluril
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ateral trade agree ment s. This is in contr ast to multi latera l trade agree ment s, whic h are GAT T/W TO agree ment s prop er and have unive rsal appli catio n. TRIP S. To break this deadl ock in talks, Arth ur Dunk el, the then
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Direc tor Gene ral of GAT T, unila terall y prese nted a 433page docu ment on Dece mber 20, 1991 . 11 The Final Act, whic h was signe d in Marr akes h in 1994 by 135 count ries, consi sted of an entir ely new set of 16
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agree ment s that had super sede d the earlie r GAT T agree ment . It creat ed a form al inter natio nal instit ution - the Worl d Trad e Orga nizati on or WT O12, whic h came into force on 1 Janu ary 1995 - to overs ee impl emen
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tatio n of multi latera l tradi ng rules. It intro duce d many new areas unde r the purvi ew of GAT T and the WT O:

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It allow ed for trade dispu tes to be brou ght befor e a Disp ute Settl emen t Body of the WT O and for retali ation acros s tradi ng categ ories for trans gress ion of rules. It enfor ced a
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shift from quant itativ e restri ction s on impo rts to tariff s, as well as great er predi ctabil ity in tariff reduc tions by forci ng every mem ber count ry to decla re tariff bindi ngs in all trade d good s, and by prom ising tariff reduc
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tion over time. Gain s from the Urug uay Roun d A t the time of signi ng the Marr akes h agree ment , the follo wing kinds of gains were to benef it the signa tories : 1. St at ic ga in s d ue
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to a re al lo ca ti o n of re so ur ce s to ar ea s of co m pa ra ti ve ad va nt ag e (t ha t is, th os e th at ar e re la ti ve ly be tt er
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at pr o d uc in g pa rti cu la r g o o ds ). 2. Ef fi ci en cy ga in s th at w o ul d re su lt fr o m re d uc ed sl ac k in ec o n o
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m ie s th at ha ve be en hi g hl y pr ot ec te d. 3. D y na m ic ga in s d ue to i m pr o ve d te ch ni ca l ef fi ci en cy or lo w er
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in p ut us e pe r u ni t of o ut p ut an d te ch n ol o gi ca l ch an ge . T he Worl d Trad e Orga nizati on (WT O) on Janu ary 1, 1995 , succe eded the
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Gene ral Agre emen t on Tarif f and Trad e (GA TT). It was a water shed event in the histo ry of globa l trade . At prese nt, the WT O has 146 mem ber count ries inclu ding India . The WT O deals with the tariff s and
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quota s betw een the mem ber count ries and work s to remo ve any anom alies. Agri cultu re was also inclu ded in the WT O (Agr eeme nt on Agri cultu re)14 . India , being one of the signa tories of WT O and after losin
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g its appe al in the WT O, liber alize d trade on agrocom modi ties as per WT O norm s. A rticle 20 of the AOA 15 ensur ed that these refor ms are an ongo ing proce ss. Renegot iatio ns in this regar d take stock
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of the exper ience of the past years and explo re the poten tial for furth er com mitm ents to the refor m proce ss. The Urug uay Roun d negot iatio ns invol ved discu ssion s on new areas such as agric ultur e, textil es, garm ents,
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trade in servi ces, trade relate d intell ectua l prop erty right s (TRI PS), and trade relate d inves tmen t meas ures (TRI MS), in three distin ct them atic grou ps. The first was reduc ing speci fic trade barri ers and impr ovin
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g mark et acces s for partn er count ries. Area s unde r this were tariff s, nontariff meas ures, tropi cal prod ucts, natur al resou rcebase d prod ucts, textil es and cloth ing, and agric ultur e. A seco nd them e was one of stren
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gthen ing GAT T disci pline s and impr ovin g the rules unde r whic h GAT T opera ted. Area s unde r this them e were GAT T articl es, safeg uards , MTN agree ment s and arran geme nts, subsi dies and count ervai ling meas
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ures, dispu te settle ment and funct ionin g of the GAT T syste m (FO GS). The third and final them e cover ed new areas inclu ding TRIP S, TRI MS, and servi ces.

FEA TUR ES OF THE WT O:

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T The WT O agree ment requi res the conv ersio n of all nontariff barri ers on agrocom modi ties trade into equiv alent tariff s. Thes e tariff rates
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equiv alent are to be comb ined with the existi ng tariff s and the result ing comp osite tariff s are to be boun d at that rate. E a c h c o u n tr y is g i v e n t
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h e fl e x i b il it y i n d is tr i b u ti n g t h e a v e r a g e ta ri
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ff c u t o v e r d if f e r e n t c o m m o d it ie s, a s l o n g a s
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e a c h i n d i v i d u al ta ri ff is r e d u c e d b y at le a st 1 5 %
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( 1 0 % f o r t h e d e v el o p i n g c o u n tr ie s) o v e r t
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h e r el e v a n t p e ri o d . W h e r e t h e r e s u lt i n g ta ri
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ff is p r o h i b it i v e, a m i n i m u m le v el o f i m p o rt s, e
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q u al t o 3 % o f d o m e st ic c o n s u m p ti o n is t o b e g u
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a r a n te e d . T h e s e m i n i m u m a c c e s s q u o ta
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s w il l ri s e t o 5 % o f d o m e st ic c o n s u m p ti o n a ft e
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r si x y e a rs . T h e m i n i m u m al l o c at i o n q u o ta s f
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o r d e v el o p i n g c o u n tr ie s c o n st it u te 2 % o f d o m
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e st ic c o n s u m p ti o n m o v i n g u p t o 4 % a ft e r 1 0 y
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e a rs . T h e a g r e e m e n t al s o p r o v i d e s f o r a c u
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t i n t h e s u b si d ie s fr o m t h e 1 9 8 6 9 0 le v el s b y
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3 6 % ( 2 4 % f o r t h e d e v el o p i n g c o u n tr ie s) o v
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e r si x y e a rs (t e n y e a rs f o r t h e d e v el o p i n g c o u
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n tr ie s) i n e q u al a n n u al i n st al l m e n ts . D e v el o p e d
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c o u n tr ie s a r e al s o r e q u ir e d t o r e d u c e t h e v o
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l u m e o f e x p o rt s o f e a c h s u b si d iz e d c o m m o d it
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y b y 2 1 % o v e r si x y e a rs w it h a v e r a g e e x p o rt le
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v el s o f 1 9 8 6 9 0 . A c o rr e s p o n d i n g r e d u ct i o
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n b y 1 4 % is r e q u ir e d f o r t h e d e v el o p i n g c o u
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n tr ie s. R e d u ct i o n i n e x p o rt s u b si d ie s o n f a r m

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p r o d u ct s i n d e v el o p e d c o u n tr ie s w il l m a k e I n
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d ia n a g ri c u lt u r al e x p o rt s m o r e c o m p et it i v e. E x
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p o rt s w il l i n c r e a s e t o $ 1 . 5 b il li o n b y 2 0 0 5 .
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F r u it s, o il s e e d s, c o tt o n , a n d m il k p r o d u ct s w il
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l b e b e n e fi te d d u e t o s u b si d y r e d u ct i o n s. T h e
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r e w il l b e h i g h e r p ri c e r e al iz at i o n s, w h ic h w il l
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h el p i n i m p r o v i n g t h e st a n d a r d o f li v i n g o f
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f a r m e rs . C o u n tr ie s w il l b e f o r c e d t o p r o d u c
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e o n l y w h at t h e y a r e b e st at . T h is w il l m e a n i n c
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r e a s e d e ff ic ie n c y a n d h i g h e r p r o d u ct i v it y t
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h r o u g h o u t I n d ia . 1 6 E n v ir o n m e n ta l p r o g r a
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m m e s a r e e x e m p t fr o m c u ts i n s u b si d ie s s o t h
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at t h e e n v ir o n m e n t p r o te ct i o n p r o g r a m m e s c
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o n ti n u e u n a b at e d . I n d ia d o e s n o t h a v e t o c u
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t s u b si d ie s o r l o w e r ta ri ff s a s m u c h a s d e v el o p
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e d c o u n tr ie s a n d it h a s b e e n g i v e n e n o u g h ti m
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e t o c o m p le te it s o b li g at i o n s. D is t o rt i o n s i n t h
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e m a r k et p la c e w o u l d r e d u c e, w h ic h w o u l d b e n
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e fi t t h e e n d c o n s u m e r. THE C H A R A C T E R I S T I C S O F W O R
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L D T R A D E O R G A N I Z A T I O N A R E A S FOL L O W S : W It A

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 A It It W It It W

BEN EFI TS FOR INDI A: R e d u ct

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i o n i n e x p o rt s u b si d ie s o n f a r m p r o d u ct s i n
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d e v el o p e d c o u n tr ie s w il l m a k e I n d ia n a g ri c u lt
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u r al e x p o rt s m o r e c o m p et it i v e. E x p o rt s w il l i n
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c r e a s e t o $ 1 . 5 b il li o n b y 2 0 0 5 . F r u it s, o il s e
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e d s, c o tt o n , a n d m il k p r o d u ct s w il l b e b e n e fi te
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d d u e t o s u b si d y r e d u ct i o n s. T h e r e w il l b e h i
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g h e r p ri c e r e al iz at i o n s, w h ic h w il l h el p i n i m p r
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o v i n g t h e st a n d a r d o f li v i n g o f f a r m e rs . C o
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u n tr ie s w il l b e f o r c e d t o p r o d u c e o n l y w h at t
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h e y a r e b e st at . T h is w il l m e a n i n c r e a s e d e ff ic
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ie n c y a n d h i g h e r p r o d u ct i v it y t h r o u g h o u t
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I n d ia . 1 6 E n v ir o n m e n ta l p r o g r a m m e s a r e e x
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e m p t fr o m c u ts i n s u b si d ie s s o t h at t h e e n v ir o
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n m e n t p r o te ct i o n p r o g r a m m e s c o n ti n u e u n a
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b at e d . I n d ia d o e s n o t h a v e t o c u t s u b si d ie s o
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r l o w e r ta ri ff s a s m u c h a s d e v el o p e d c o u n tr ie s
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a n d it h a s b e e n g i v e n e n o u g h ti m e t o c o m p le te
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it s o b li g at i o n s. D is t o rt i o n s i n t h e m a r k et p la c
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e w o u l d r e d u c e, w h ic h w o u l d b e n e fi t t h e e n d
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c o n s u m e r.

C H A P T E R

THE AGR EE ME NT ON AGR ICU LTU RE: The Agre emen t on Agri cultu re
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signe d at the end of the Urug uay Roun d of negot iatio ns deals main ly with the natur e of entry of the impo rted good s in dome stic mark ets and the natur e of supp ort provi ded to the dome stic
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farm ers and expo rters of agric ultur al good s by their gove rnme nts. It also lists the differ ent types of crops subsi dies that have to be reduc ed. T he Agre emen t on Agri cultu re signe d at the end of the
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Urug uay Roun d of negot iatio ns, whic h has as its objec tive the estab lishm ent of a fair and mark etorien ted agric ultur al tradi ng syste m, dealt with three grou ps of issue s. Thes e were b r
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MA RKE T ACC ESS: M arket acces s was soug ht to be incre ased in a num ber of ways . First, the AoA made tarrif icatio n mand atory . That is, count ries had to dism antle, in a
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phas ed mann er, any nontariff barri ers such as a ban on impo rts of parti cular agric ultur al prod ucts or ceilin gs set on the quant ities of indiv idual prod ucts that could be impo rted (othe rwise term ed quant itativ e restri ction
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s or QRs) , and only use impo rt tariff s or dutie s as mean s of prote ction . S econ d, the agree ment requi red that the devel oped count ries reduc e their tariff level s by 36 perce nt over a sixyear perio d from the start of impl
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emen tatio n, with a com mitm ent to reduc e tariff s on each tariff line by a mini mum of 10 perce nt. Deve lopin g count ries were requi red to reduc e tariff s by 24 perce nt over a 4year perio d, and ensur e a tariff reduc tion
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of 10 perce nt in each tariff line1 7. Third , all count ries had to speci fy ceilin gs at whic h their tariff s were boun d, or the maxi mum level to whic h tariff s woul d be raise d unde r any circu msta nces. Final ly, there was a
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mini mum level of actua l acces s of impo rted com modi ties to dome stic mark ets that each count ry had to ensur e. This was set at 3 perce nt of avera ge dome stic cons umpt ion durin g the 1986 -88 refer ence years , to be ensur ed
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by 1995 and 5 perce nt of the same by 2000 in the case of the devel oped count ries and 2004 in the case of the devel opin g count ries. If count ries did not refle ct this mini mum acces s, they were expe cted to use the
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mech anis m of tarif f-rate quota s, or lowe r tariff s for impo rts of a magn itude requi red to ensur e the realiz ation of mini mum acces s requi reme nts. Desp ite these detail ed speci ficati ons, the AoA provi ded count ries with an esca pe
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claus e in the event of a large and disru ptive inflo w of impo rts. Unde r the Speci al Safe guar ds provi sions , count ries that had tarrif ied their QRs, It need s to be noted that given the level of such tariff s at the time of impl emen tatio
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n of the tariff reduc tion com mitm ent, the actua l incre ase in acces s may not be subst antial . The least devel oped count ries were provi ded a conc essio n, as they were not requi red to reduc e their tariff level s. tarrif ied prod
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ucts, with an impo rt surge or by a fall in impo rt price s to level s that were low relati ve to those that preva iled durin g the 1986 -88 refer ence perio d, were allow ed to impo se highe r tariff s and other restri ction s to restra in impo
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rts. DO MES TIC SUP POR T The AoA defin ed the princ iples on the basis of whic h the Aggr egate Meas ure of Supp ort (AM S) provi ded by the gove rnme nt of a count ry to its agric ultur al secto r was to be
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comp uted. The aggre gate meas ure of supp ort was the sum total of the AoA prod uctspeci fic and nonprod uctspeci fic supp ort provi ded by natio nal and subnatio nal or feder al gove rnme nts in indiv idual count ries. The
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origi nal Dunk el Draft of the Urug uay Roun d Agre emen t provi ded for com mitm ents to reduc e dome stic supp ort on a prod uctbyprod uct basis . How ever, the agree ment betw een the G-2, the US, and EC at meeti
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ngs that took place at Blair Hous e in Was hingt on in Nove mber 1992 (kno wn as the Blair Hous e Acco rd), whic h pave d the way for the succe ssful concl usion of the negot iatio ns on the Urug uay Roun d, repla ced these prod
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uctwise com mitm ents to a com mitm ent to reduc e overa ll supp ort to agric ultur e18. Not all of these meas ures of supp ort were consi dered viola tive of free trade princ iples and there fore eligi ble for inclu sion in calcu latio
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ns of the AMS . In fact, the Agre emen t on Agri cultu re categ orize d the differ ent possi ble meas ures of supp ort into three categ ories. The first, term ed the amb er box meas ures, were seen as thos e polic ies, whic h do have a subst
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antial impa ct on the patte rns and flow of trade . All such dome stic supp ort meas ures were to be taken into acco unt while comp uting the AMS level, and count ries had to com mit them selve s to reduc e in the after math of the agree ment
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. The seco nd term ed the gree nbox meas ures were those that were seen as havin g no majo r effec t on prod uctio n and trade and were consi dered comp letely nonviola tive of the AoA and not subje cted to any reduc tion com
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mitm ents. They inclu ded a varie ty of dire ct paym ents to farm ers, whic h were seen as augm entin g their inco mes with out influ encin g prod uctio n decis ions. Som e of them were: P R E
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 R P A D C G

SUP POR T IN THE FOR M OF SUB SIDI ES CO MES BY WA Y OF: pr ic e

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su p p or t, or m ea su re s su ch as g o ve rn m en t pr oc ur e m en t, ba ck ed b y ex p or t or i m p or t co nt ro ls us in g
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ta rif fs an d Q R s an d b u d ge ta ry su p p or t, in th e fo r m of ex pl ic it b u d ge ta ry o ut la ys o n su bs id ie s o
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n fa r m in p ut s an d cr ed it, ag ri cu lt ur al re se ar ch an d ex te ns io n, de fi ci en cy pa y m en ts, in su ra nc e an d di sa st
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er pa y m en ts, di ve rs io n pa y m en ts fo r te m p or ar y re tir e m en t of re so ur ce s, an d co m pe ns at io n in li eu of re
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d uc ti o ns in m ar ke t pr ic e su p p or t or i m pl ic it b u d ge ta ry o ut la y in th e fo r m of re ve n ue s fo re g o
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ne as a m ea su re of su p p or t to ag ri cu lt ur e.

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WT O & AGR ICU LTU RE IN INDI A: India is one of the foun ding mem bers of WT O whic h came into exist ence on Janu ary 01, 1995 repla cing GAT T (Gen eral Agre emen t on Tarif fs and Trad
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e) and prom ising the heral d of new era in the rule base d syste m of gove rning and prom oting inter natio nal trade conc omit ant with the need s of the ongoin g proce ssor globa lizati on. WT O provi sions relate d to inter
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natio nal trade are now simil arly appli cable to agric ultur e whic h was brou ght withi n the fold of GAT T in the Urug uay Roun d (198 6-93) of multi latera l trade Nego tiatio ns (MT Ns). Appl icatio n of WT O provi sions
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on agric ultur e invol ves many conte ntion s issue s and is an area of serio us conc ern for devel opin g count ries whic h are prim arily agrar ian econ omie s, More over, the worl d, despi te grow ing inter depe nden ce and
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integ ratio n, is highl y heter ogen eous with regar d to level s of devel opme nt. This heter ogen eity is very much notic eable when we comp are the agric ultur al secto r of devel oped and devel opin g count ries. Supp ort infra struct ure
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like stora ge, proce ssing , finan ce, mark eting , trans port and R&D facili ties are much more adva nced and orga nized . In sharp contr ast, in a count ry like India , for milli ons of farm ers who deriv ed their liveli hood from agric ultur
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al, it is still a way of life and not an occu patio n they have chos en for them selve s. India n farm ers are mostl y invol ved in subsi stenc e farmi ng with very little or no mark etabl e surpl us. On the
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other hand, there have veer insta nces wher e in the USA farm ers have been given subsi dies wort h milli ons of dolla rs to keep their farml and uncul tivate d. In India 70% of the holdi ng are not of the econ omy size, maki ng appli catio
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n of mode rn techn olog y diffic ult and unaff orda ble for the farm ers. The devel oped count ries like the USA , Japa n and EU count ries heavi ly subsi dize their agric ultur e with high quali ty stand ards and aggre ssive
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mark eting pract ices, these count ries hold 72% share of worl d trade in agric ultur al prod ucts are keep the devel opin g count ries virtu ally at the perip hery of worl d mark et. The silent featu res 0f this agree ment inclu
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de three main provi sions whic h have beco me effec tive 1 Jan, 2000 . Unde r acces s all nontariff barri ers like quota will be conv erted into tariff s. India has alrea dy remo ved quant itativ e restri ction on all her impo
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rt. It has now impo sed prote ctive tariff on impo rts of sensi tive agric ultur al prod ucts in order to prote ct the inter est of its farmi ng com muni ty. As far as the maxi mum limit of tariff is conc erned no count
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ry is perm itted to impo se tariff beyo nd a certai n limit. All indus triali zatio n count ries are to reduc e tariff by 36% withi n six years . For indiv idual agric ultur al prod ucts tariff has to reduc e by at least 15%. Deve lopin g count
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ries like India have to reduc e tariff by 24% withi n 10 years . On any indiv idual agro prod uct tariff cut has to be at least by 10%. Unde r Expo rt Com petiti on the devel oped count ries are to reduc e the value of direc t
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expo rt subsi dies by 36% over a perio d of six years and in volu me terms 21%. The base perio d for these cut is 1986 -90 or 9192 if expo rts were highe r in that perio d. Over the same perio ds the devel opin g count ries
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are to reduc e the value of direc t expo rt subsi dies by 24% and volu me terms by 10%. Unde r dome stic supp ort this issue is linke d to provi ding state supp ort to farm ers in farm prod uctio n. Unde r AoA (Agr
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eeme nt on Agri cultu re) the devel oped count ries are to reduc e AM BER BOX subsi dies withi n 6 years by 20c starti ng from 1995 with 1986 -88 perio ds as base. The same has to be reduc ed by 13c withi n 10 years by devel opin
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g count ries. AoA has classi fied all subsi dies given to farm ers into three categ ories AM BER BOX subsi dies, BLU E BOX subsi dies and GRE EN BOX subsi dies. Unde r AM BER box subsi dies such dome stic supp ort its inclu
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ded whic h is mean t to enco urage farm ers to prod uce more . BLU E BOX subsi dies are relate d to quant um of outp ut and henc e are consi dered mini mall y trade disto rting. Such subsi ded is provi ded only up to certai
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n limit of prod uctio n. GRE EN BOX subsi diary aid to farm ers come s unde r this categ ory. The devel oped count ries have used provi sions of AoA to furth er infest of their farm ers. The devel oped count ries have used
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provi sions of AoA to furth er the inter est of their farm ers. For exam ple, they have remo delle d AM BER BOX subsi dies in such a way that these quali ties to be put into BLU E or GRE EN BOX subsi dies. Thes e count ries
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are const antly press uring the devel opin g count ries for great er mark et acces s for agric ultur al prod uct but are not willi ng to bring down the level supp ort that they provi de to their own farm ers. Deve lopin g count ries
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like India feel that they are being discri mina ted again st in matte r like tariff on food impo rts into devel oped count ries. For exam ple, in the name of mutu al acces s, OEC D count ries impo se very low tariff on impo rts from
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fello w mem bers while simil ar impo rts from devel opin g count ries are subje cted to highe r tariff s. The Nov. 2001 Doha roun d of minis terial talks were term ed as Dev elop ment Roun d beca use comp rehen sive devel opme
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nt of the acce pted as its agen da. Theo retica lly, issue s like prod uctio n and trade of agric ultur e prod ucts along with dome stic supp ort and subsi dy to it, comp lianc e issue s, intell ectua l prop erty right s, speci
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al discri mina tory pract ices and mark et acces s were to be discu ssed. But soon it beca me clear that on the grou nd devel oped count ries were not willi ng to yield much to the devel opin g count ries for deep er mark et
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acces s. By the termi natio n of this roun d it was clear that issue relate d to agric ultur e push ed other issue s to the back grou nd. For the devel opin g count ries safeg uardi ng the inter est of their farmi ng secto r is a
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matte r relate d to the very survi val and subst ances of their popu latio n. More over in a repre senta tive demo cracy like ours it woul d be a politi cal harakiri if the gove rnme nt ignor es the inter ests of farm ers and agric
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ultur e unde r inter natio nal comp ulsio ns. In the Doha roun d of negot iatio ns, while the devel oped count ries were main ly conc erned about issue s like mark et acces s and IPR, the devel opin g count ries were conc erned
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about food secur ity, pove rty elimi natio n and econ omic grow th with respe ct to the proce ss of globa lizati on. It is alleg ed by devel opin g count ies that the devel oped worl d show s only hypo critic al conc ern about these issue
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. In the farm bill in the USA and the colle ctive farmi ng polic y in EU, agate supp ort has been prom ised to the farm ers than befor e. Sensi ng a majo r deadl ock in futur e roun ds of discu ssion s on AoA, the agric
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ultur e minis ters of EU count ries prese nted a recon ciliat ory pack age in the last week of June 2003 . In this they prom ised not to offer any subsi dy to their farm er but insist ed that agric ultur al inco me worl d
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still be prote cted. This is a wily move as it repla ced a trade disto rting meas ure like subsi dy by prote ction of agric ultur e inco me whic h will not be treate d as trade disto rting and henc e quali fies to be put in the GRE
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EN BOX . It woul d be a misn omer to call such prote ction as mini mall y trade disto rting beca use it will influ ence the alloc ation of recou rses in the since that in the abse nce of such prote ction fewe r resou
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rces woul d be com mitte d to agric ultur e prote ction will serve as an incen tive not to move resou rces away from agric ultur e leadi ng to over prod uctio n this surpl us prod uce will be used to disall ow impo rts from the
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devel opin g worl d or for dum ping in the worl d mark et. The worst aspec t of this pack age was that not even a ment ion of reduc ing expo rt subsi dy foun d place in it. The minis terial meet at Canc un in Mexi
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co held on 1014 sep. 2003 raise d quest ions on the work ing of the whol e appar atus of WT O. The only majo r achie veme nt on the part of the devel opin g count ries was that they did not succ umb
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to the press ures of the devel oped count ries. As expe cted the Canc un meet too was focus ed on agric ultur e G5 grou p count ries with India , china , Brazi l, Arge ntina and Sout h Afric a as its mem bers emph asize
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d the urge ncy of the need to reduc e farm subsi dy in the devel oped count ries espec ially in the USA and EU count ries. India playe d a pro activ e role in this initia tive. It was highl ighte d that the cotto n expo
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rt depe ndent econ omie s of the worl d like Chad , benig n, male and Burk ina Faso have suffe red mass ively due to the farm subsi dy that the USA gives to its 25,0 00 cotto n grow ers. Even Austr alia and New Zeala nd
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supp orted the stand taken by the G-21 grou p of the devel opin g count ries. The revis ed draft prese nted for negot iatio ns was heavi ly tilted in favo ur of the devel oped count ries. It requi red the devel opin g count ries like India
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to reduc e farm subsi dy by 70% while EU mem bers and the USA were requi red to reduc e it by 41% and 36% respe ctivel y. The revis ed draft was a big blow to the heigh tened expe ctatio n of the devel opin g count ries.

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At coco on the devel oped count ries did not yield much to the outst andin g dema nd of the devel opin g worl d but cleve rly inclu ded issue s like inves tmen t, comp etitio n, trade facili ty and gove rnme nt proc urem
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ent to build press ure on the devel opin g count ries. Honk Kong minis terial confe rence ende d in the same mann er. The devel opin g count ries, led by G-5 oppo sed the prop osals of US and Euro pean Unio n on the grou
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nd that they were again st the inter ests of the poor count ries. Doha roun d talks are at the mom ent floun derin g beca use of the unco mpro misin g stand s adopt ed by playe rs such as EU, US and G-5. The
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inter estin g part of the whol e thing is not one can be said to be the main culpr its beca use every Gove rnme nt invol veme nt in the WT O negot iatio ns is squar ely acco untab le and answ erabl e to its const itutio n and
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popu latio n back home , whic h mean s amon g other thing s, that no com mitm ent can be made whic h will lead to weak ening of the dome stic supp ort base beyo nd a point . Politi cally the issue of AoA is so
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sensi tive that no gove rnme nt, whet her in the devel oped or the devel opin g count ries, is in a positi on to comp romi se with the inter ests of farm ers in the name of colle ctivis m. Now the quest ion arise s
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that what shoul d be India ns strate gy? As thing s stand at prese nt, the provi sions of AoA do not appe ar to have a threa tenin g impa ct on dome stic supp ort and expo rt subsi dy unde r AoA. The nonprod uct speci fic
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supp ort amou nts to 7.5% of the value of agric ultur e prod uctio n in India . Since prod uct speci fic supp ort is negat ive, the Aggr egate meas ure of supp ort to India n agric ultur e is still belo w the demo netis
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e of 10 perce nt in terms of the Urug uay roun d stipul ation s. India has alrea dy sugg ested that AMS be calcu lated as the sum of the prod uct speci fic and nonprod uct speci fic supp ort (WT O 2001 ). As the input subsi
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des to resou rcepoor farm ers are exem pt from reduc tion com mitm ents unde r WT O (thes e come unde r non prod uct speci fic supp ort), so the overa ll level of supp ort given to India n Agri cultu re is less than
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the mini mum of 10% as set unde r WT O stipul ation s. Agri cultu re secto r in India has respo nded positi vely to the launc hing of macr oeco nomi c refor ms in 1991 . With liber alizat ion of exch ange rate, the
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terms of trade for agric ultur e have show n a signi fican t impr ovem ent. Priva te inves tmen t in agric ultur e regist ered a step rise in the postrefor m perio d. For the first time since indep ende nce India has beco me a net
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expo rter of food grain . The fear that liber alizat ion of impo rts woul d lead to mass ive influ x of agric ultur e impo rts too has been foun d to be mispl aced. Quan titati ve restri ction s on impo rts have been lifted since
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April 2000 . Thou gh impo rt like fruits , ketch up and meat prod ucts have incre ased, they still acco unt for a minis cule of total agric ultur al impo rts. Thou gh there is clearl y a need to be const antly vigil ant and work in
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leagu e with other devel opin g count ries and remo val of tariff and nontariff barri ers, the majo r chall enge s the devel oped count ries at WT O, we need to take meas ures whic h make India n agric ultur e more comp etitiv
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e. The fortu nes of India n agric ultur e whic h now acco unts for about 20% of the GDP and provi des empl oyme nt to about 60% of labou r force cruci ally depe nd upon great er inves tmen t, both priva te and publi
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c, in irriga tion powe r, roads and the abilit y of agric ulturi sts to acces s the mode rn techn olog y speci ally the yield augm entin g techn olog y. Cond itions need to be creat ed for wide sprea d diffu sion and appli catio n of this techn
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olog y by the farm secto r. To concl ude, it can be said that WT O provi sions pose no real threa t to India n agric ultur e thou gh aspec ts relate d to IPR, remo val of tariff and nontariff barri ers and mark et acces
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s need to be dealt with const ant vigil and suita ble exper tise. Rele vant instit ution al and legal chan ges (like in paten ting) need to be brou ght about Equa lly impo rt is the need to restr uctur e, modi fy and reva mp our agric ultur
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e secto r so that it can rise up to the chall enge s thro wn by grow ing integ ratio n with the rest of the worl d. The need of the time is to make it more effici ent, mode rn diver sified and comp etitiv e. The time
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to engin eer a seco nd Gree n revol ution has arriv ed.

Due to the Agreement on Agriculture (AOA), India can no longer remain aloof from the rest of the world. It had to join the WTO. This AOA has established a number of generally applicable rules with regard to agriculture and trade related matters. Most of the developed countries are providing huge subsidies to the agricultural sector. In these countries not more than 10% of the population is dependent on agriculture. The below table gives the information about the subsidies that are being given to agriculture by different countries and the percentage of the population depending on agriculture India provides only 2.33% subsidy to agriculture. It is very small when compared with other countries. The Aggregate Measure of Support (AMS) to agriculture will be 10 percent in India as against 5% in the developed world. The total subsidy on agriculture in the developed world works out to $150 billion and in the developing world $19 Billion. If the AMS exceeds 10 percent in any country, it has to reduce by 13% by 2004. According to the WTO the AMS in India, product subsidies is 7.5% and subsidy on non-product is minus 38.5%. So there is no question of losing any thing in our agriculture by accepting the AOA.

SUBSIDIES TO AGRICULTURE: Country EEC USA Japan China South Africa India

TARIFFS: The tariff on agricultural commodities have been consider-ably restructured to comply with WTO requirements. India is committed to reduce tariffs on 686 agricultural products. The
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average tariff on agricultural commodities was 115% before the agreement. After the agreement it has been reduced to 35%. Along with 686 commodities the tariff on 587 other commodities is on an average 50% less than the negotiated tariff. Only on 10 commodities is the tariff rate more than the negotiated tariff rate. We must recall, in this context that two decades ago India agreed at an international meeting to reduce the tariff either to zero or to a minimum level on the import of dairy products. In other words, India had accepted in principle the import of agricultural products many years ago. In the case of edible oils we agreed (binding) to impose a tariff of up to 150 percent but the bounded duty at present is 0. With a duty reduction on edible oils as low as 25%, hundreds of oil mills have closed down, groundnut farmers are unable to get a minimum price and even compelled to dispose of their product at huge losses. Pulses were imported under OGL (Open General License) at zero interest rates. In July 1999 the Government of India sought to renegotiate the tariff on pulses. But the international community has not yielded.

Investment: Indian agriculture needs a lot of investment to have large-scale production. By this we can reduce production costs. But the problem is that large scale agriculture displaces persons who are dependent on agriculture. Instead of criticizing WTO we have to think of an alternative system. Corporatization of agriculture is seen to be inimical to social justice. Redistribution of land to the landless poor through the various land ceiling acts leads to fragmentation which will be a hurdle to improved production as well as productivity. Patent System: Plants such as neem, turmeric and products such as Basmati (scented rice) are patented or about to be patented by American companies. It is strange that in India these have been household plants used in cooking and for medicinal purposes since ancient times. The system of Ayurveda has existed since times immemorial. All medicinal products based on plants and plant products must be patented by Indian companies. Conceding the patent rights to an American based company is ridiculous and we have to take this up with the WTOs Dispute Settlement Board (DSB) at Geneva. The challenges before Indian agriculture are immense. India is not where it should have been in the world market for agricultural products despite being one of the top producers. The country needs to put greater emphasis on cultivation of international varieties. Until India takes some steps in this direction, it will continue to produce more only to earn less. The major challenges for Indian agriculture system would always be increasing production and productivity to ensure food security for the raising population. Rigid quality control is a major challenge for Indian agriculture. The global agricultural market is influenced to a great extent by the quality of products, especially when exporting to developed nations. Indian agricultural exports have to face tough competition, which is a matter of serious concern. The right type of technology for growing and processing must be adopted so that there is good quality production at lower costs, which in turn will reduce the prices and place India in a better position to compete globally.
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Indian producers produce agricultural goods at competitive prices. Yet low global prices resulting from subsidies by the developed nations mainly the European Union and United States, deprives India of any advantage on the price front. The US is exporting wheat at prices 40 per cent lower than production costs. In the case of soybean, the price difference has been increasing steadily over the last four years and is currently at 30 per cent while for maize it is 25-30 per cent. In 2001, cotton was being sold in the international markets at a price 57 per cent lower than its production cost, while the price difference for rice has stabilized at 20 per cent. As a result of these prices, the US Is the worlds largest exporter of wheat, corn, cotton and soybean, and the second largest in rice. While agricultural trade liberalization was justified on the grounds that Northern agricultural markets would open to India, Indias exports to Europe have actually declined from 13 to 6 per cent. This is because the North still maintains high subsidies and trade barriers. The WTO regime has become a challenge because it has shown that agriculture trade liberalization has become a unidirectional phenomenon that opens markets in the South for Northern business corporations but closes markets in the North for trade from South. Such trade will destroy livelihood opportunities for resource-poor farming families and agricultural labour. Global forces are now playing an important role in determination of cropping patterns, investment levels, price structures, quality of production and level of international trade. Indian farmers are facing multiple challenges. Firstly, they are being asked to provide a greater variety of better quality products at lower cost, and in a safer manner than ever demanded before. Secondly, they are being asked to produce this abundance on a shrinking natural resources base that is often subject to government regulations. As far as India is concerned there are some danger signals. Population growth rate and higher per capita income suggest that demand for food grains is growing. But there are doubts about the supply response. In terms of acreage, area under food grains has not increased. Yield growth rates of food grains are also stagnating in most parts of the country. The productivity of soil has also started declining. The underground water table in most Indian states is getting rapidly depleted. Based on these facts, various studies have pointed out that India will be a net importer of rice in the near future. FISHING IN INDIAN WATERS: There is another problem that has arisen as a result of our accepting WTO norms. Every country has to allow fishermen of other countries to catch fish in its territorial waters. India exports special grade fish (Tuna and Prawns) to other countries and earns substantial foreign exchange. Around 10 lakhs people are dependent on fishing. Deep sea fishing leads to exhausting not only fish resources, but also displacement of our people in fish catching, processing industries etc. This too is an issue that needs to be discussed at the appropriate WTO forum.

BENEFITING THE CONSUMER:

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Given that exports from India are already very low, we will be put to greater disadvantage if new hurdles are put in the way of our exports. There are still larger issues of public good at stake in such decisions. If producers from other countries were able to offer better commodities at far cheaper prices, it would be unjust and unfair to the Indian consumers to restrict or ban such imports indefinitely. Expecting such protection as a time bound measure may be reasonable, if during that limited time span, we make determined efforts to increase productivity in agriculture, improve the infrastructure and upgrade the efficiency of Indian industry to face global competition. We, the farmers of India are confident that with judicious measures of protection during the brief transition period of 4-5 years, we will be able to successfully face international competition by building world class agriculture, provided the government gets off our backs and stops putting new hurdles in our way. THE QUESTION OF SUBSIDIES: Another important stipulation in the WTO Agreement on Agriculture is that Governments direct support to agriculture i.e. non-product-specific. The Aggregate Measurement Support (AMS) should not exceed 5% in the case of developed countries and 10% in the case of developing countries. USA, Europe, S. Korea, Japan etc., support agriculture in various ways. In rich countries, it has become necessary to ensure that agriculture continues and that some people stay in agriculture. Besides, if the whole of the country becomes a forest of industries and cement concrete, there is a risk of the environment being destroyed. For these reasons, richer countries feel the need to keep agriculture operating and even flourishing. Subsidies and income guarantees are given for producing as also for not producing. There is a subsidy for producing a commodity and another subsidy for not producing the same commodity. There is also a subsidy for keeping the land fallow. Apart from this, governments spend liberally on research in agriculture; the development of underdeveloped areas; infra-structure, transport and communication to mention a few. The situation in India is quite the contrary. In rich countries 1 to 2% of the population depends on agriculture. In India, it is more than 70%. 98% of the population of developed countries can extend ample help to their 2% farmers. On the other hand, 30% of Indias population cannot extend much help to 70% farmers; nor is there the political will to do so. Therefore, the Indian farmer faces the continuing prospect of being crushed under negative subsidy for decades to come. Some suggest that the Government should get included in the WTO Agreement, new ways and means to support farmers. As of today, there isnt any condition in the WTO Agreement on Agriculture (AoA), which stops the Indian government from helping farmers. Therefore, talking of fresh provisions is pointless. EXPORTING AGRICULTURAL PRODUCE: Coming to ground realities, what are the prospects and scope for the export of Indian agricultural produce? Potential exporters will face difficulties both in the domestic and foreign
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markets. The demand for Indian farm products (excluding some exceptions like Basmati Rice, Darjeeling Tea etc.) is very low. The reason is that Indian products are of poor quality. India lacks a system of grading and testing our produce. There is little awareness of regulations that are accepted the world over as necessary for the protection of the health of a consumer. Due to the license-permit system, Indian exporters have earned a bad name as unreliable suppliers. Indian agricultural exports are limited to ethnic markets catered through cousin-tocousin channels. The deficiencies in Indian agriculture pose severe problems in entering the world market. Land in India, due to various land-related Acts and chronic penury, is fragmented. Efforts to encourage the consolidation of land and production of quality-produce in viable volumes have been ineffective. Besides, the infra-structure for storage, transport, processing, grading and rating quality-standards are almost non-existent. Farmers fail to comprehend the sophistication of global markets, as their experience is limited to primitive APMC operations.

THE PLIGHT OF INDIAN FARMERS: Up to 1996-97, the prices of most agricultural commodities in the global markets were higher than those in Indias domestic market and, therefore, there was a clear comparative advantage in exports. At least at the farm gate, the Indian farmer was capable of competing with any farmer in the world. By the time the produce reached the point of embarkation, poor infrastructure wiped out most of the advantages. Even then, in some areas like organic farming products, medicinal and aromatic plants, multiplication of hybrid seeds etc., India had an advantage in global markets. This situation has rapidly changed in the last 2-3 years. Modern technology has helped improve agricultural productivity in many countries around the world. As a result, there is a glut in the agricultural commodity market and a recession in prices. Therefore, the Indian farmer is not able to export several agricultural products, as our domestic prices are higher than those in global markets. The condition of the Indian farmer is like that of a debilitated convalescent trying to face a flood. Exploited by the white colonial rulers and now by our own brown rulers, our land has been fragmented and depleted of fertility resulting in low production, capital evasion, lack of new investment, poor infrastructure; the lack of storage and marketing facilities; inadequate irrigation and electricity, the absence of roads and the insufferable burden of indebtedness. And then one fine morning, our farmers in such a condition, see a surging flood of globalization and revolution in biotechnology. The basic objective of globalization is to improve the global Division of Labour with reference to comparative advantage. Indian agriculture has the benefit of abundant sunlight, ample water and a hardy peasantry. Ultimately, these elements will be decisive in global competition. But while taking the such big leap from traditional agriculture to world-class competitive agriculture, some measures need to be taken that will be immensely useful and
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essential. These are: Freeing Indian Agriculture from State Control

Unifying the Indian Market

Modernization of Market Networks In India, agricultural commodities are sold mostly through Agricultural Produce Marketing Committees (APMCs). At one time, these Committees helped to improve agricultural marketing. But, today they do not provide even minimal facilities required for marketing, like shelter, godowns, facilities for processing, grading, sorting, quality evaluation, packaging, and information on various commodity markets, etc. Commission agents and adatiyas dominate these markets. If, instead of this system, another one like super-market networks so common in many developed countries take over, farmers will feel comfortable entering global markets. Information Network Information regarding price, the demand and supply positions of commodities in different markets all over the world, weather reports and forecasts and agricultural extension advice must be easily accessible to farmers in the villages. Websites and portals providing such information and services are available. Development of information and communication networks enabling
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farmers to have access to this information is necessary. Warehousing Receipts The present system for the purchase of cereals and other farm produce must be changed and replaced by a system of storing farm produce in warehouses and extending to farmers credit to the extent of 70% of the value of material kept in godowns, needs to be introduced. This can easily be done by recognizing warehouse receipts under the Negotiable Instruments Act. Corporatization with Land Equity All these measures are beyond the ambit of the State. They are also beyond the capabilities of co-operative establishments. For this, the efficiency of the company structure (joint stock companies) and the sense of participation and involvement of co-operatives will have to be brought together to forge new forms of economic institutions. Farmers could come together and form companies with share holdings proportionate to their land. Joint Stock Companies should take responsibility for finance, management, technology, and post-harvest work like warehousing, storage, processing, sales and export. If this is achieved, Indian farmers will be able to handle the challenge of global competition. After thousands of years of enslavement and exploitation, with changes in the situation worldwide the chain that binds the hands and legs of the farmers - are breaking. Opportunists would like us to believe that there is happiness in living as slaves and that freedom is painful. Farmers cannot be deceived by such calumnies and allow themselves to be diverted from their determination to live with self-respect and in freedom. Editors Note: This extract has been edited to make for easier reading without in any way changing the meaning or the thrust of this part of the Declaration. Kerala farmers driven to death by falling produce prices Thiruvanathapuram, April 11 Incidences of farmers committing suicide following the fall in prices of agricultural commodities have been reported in Kerala A farmer in the northern district of Palakkad ended his life by consuming pesticides after he was served notice from a bank for revenue recovery. The body of 38-year old Ganeshan, a traditional paddy cultivator, was found in his fields last week. Ganeshan, who owed Rs.2.75 lakhs to the Land Mortgage Bank by way of loan and interest, had hidden the notice he received from his family members. Farmers organizations say that the plight of a large number of farmers in the state is similar. The steep fall in the prices of agricultural commodities like rubber, coffee, coconut and tea as a result of globalization have pushed farmers to penury. The Kerala farmers have suffered losses to the tune of Rs.6,650 crores in 2000-2001, according to a recent study conducted by the Kerala Agricultural Prices Board for a workshop on World Trade Organization.

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Board Chairman Dr. Thomas Varghese said that the per capita loss suffered by farmers in Kerala would amount to Rs.12,000 per annum.

IMPLICATIONS OF AOA ON INDIAN AGRICULTURE:

The repercussions of the WTO Agreement and the removal of Quantitative Restrictions on imports are quite alarming. The fall in the prices of agricultural goods and dumping of cheap agriculture commodities from other countries is causing harm to the welfare of Indian farmers. Developed countries have imposed heavy tariffs to minimize imports, whereas in India tariffs are low. Due to this, various commodities are being dumped in India. The US is dumping five primary farm commodities in global markets in clear violation of WTO Agriculture rules. It is exporting corn, soybean, wheat, rice and cotton at prices far below their production cost in an effort to wipe out global competition. The continuation of high domestic support to agriculture in developed countries is a cause of concern as they encourage overproduction in these countries leading to low levels of international prices of agricultural products. At the same time the rich industrialized countries continue to subsidize farmers by giving them direct payments which are exempt from any reductions requirement and which essentially are cash handouts contingent on making adjustments in production. These payments are neither affordable nor helpful in a developing country. The result is that the industrialized countries continue to dominate world trade in agriculture while preventing India and other developing countries from achieving self-sufficiency in food production. The AoAs requirement to reduce domestic support will prevent the Indian government from providing the necessary support to farmers to compensate for shortage or overabundance caused by climatic fluctuations in market prices or any other factors. In fact subsidies are essential for Indian agriculture as 65 per cent of people are directly or indirectly dependent upon agriculture. It is no longer the question of mere economics because the social and political implications of developments in agriculture cannot be ignored. The domestic support provision also affects Indias food security. The Agreement exempts governmental expenditures relating to public stockholding for food security purposes from reduction requirement if the operation of such a programme is transparent and follows officially published objective criteria. This automatically subjects these programmes to external scrutiny. A developing country may acquire and release foodstuffs at administered prices; however, the difference between the international market price and the administered price will be included in the calculation of AMS. Therefore, the public stockholding system will be subject to reduction requirements if the AMS exceeds the de minimize level.
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The export commitment requirements, in turn, prevent India from providing subsidies to industry that are necessary for it to expand its share of world export markets. This limitation will also adversely affect the future of Indian agriculture. The reduction in custom duties and non-tariff barriers as well as guaranteed minimum market share for imports will force Indian farmers to compete against large Transnational Corporations which have excessive financial power resulting from their oligopolistic control over world food markets. Indian farmers cannot compete on equal terms against the enormous financial and technological clout of the transnational giants of the rich countries, particularly when custom duties and other import barriers are reduced, and these companies are guaranteed a share of Indian market. Compliance with market access requirements will devastate domestic food production and India will become dependent on foreign food grains. To conclude, it is feared that the Agreement is not favorable to India due to the following reasons: The country will be compelled to import at least 3% of the domestic demand for agricultural products. The government will be forced to reduce subsidies to farmers. The Public Distribution System and Public Procurement System will have to be abandoned.

Inclusion of new trade agenda issues in the next round is considered by some developing country negotiators as undesirable because it would distract attention from the market access issues that are deemed to be of greater importance to them. However, inclusion would have the advantage that more OECD non-agricultural groups would take part in the round which could counter-balance forces favoring agricultural (and other sectoral) protection. As well, better rules on some of those new issues would reduce the risk of farm trade measures being replaced or made ineffective by domestic agricultural measures and technical barriers to trade that may be almost as trade distorting a risk that has grown considerably in the past year or so (Anderson 1998b; Roberts, Josling and Orden 1999). The new trade agenda issues are highly relevant to agriculture. Indeed, some of them figured prominently in the Uruguay Round negotiations on agriculture. For example, progress was made in designing rules for the application of sanitary and phytosanitary standards, and in disciplining the ability of governments to grant agricultural production subsidies. However, disciplines are weak, country-specific, or nonexistent in many other areas. These include competition-related policy and regulation (the nexus of state-trading, export taxes and cartels, and intellectual property broadly defined to include indications of origin, breeders rights and seed varieties), liberalization of ancillary services and input markets (distribution, marketing, use of new production technologies),and the extra-territorial application of production process standards.
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The UR Agreement on Sanitary and Phytosanitary (SPS) standards requires that SPS measures be imposed only to the extent necessary to ensure adequate food safety and animal and plant health on the basis of scientific information, and are the least trade-restrictive measures 15 available to achieve the risk reduction desired. Although there is substantial wiggle room in the wording of disciplines, the dispute settlement evidence to date shows that exporting countries can succeed in obtaining rulings against the most egregious cases of protectionist abuse of standards (Roberts 1998). As is generally the case, the SPS agreement was motivated by market access concerns. The relevance of much of the new trade agenda is that it mostly concerns For example, in some countries entry and arbitrage barriers may be significant; or state-trading entities (STEs) may have the exclusive right to import and/or to export so as to control domestic supply and distribution of agricultural commodities (Ingco and Ng 1998). India is an extreme case where there are restrictions on mobility and trade in agricultural goods, with private traders being prohibited to build up stocks in key staples or to engage in arbitrage activity across districts. In part such restrictions are enforced because of the existence of monopsony state buying agencies (e.g., in cotton).14 The point is a general one: the positive payoff to developing country agriculture from domestic regulatory reform can be substantial (Gisselquist and Srivastava (1997). Governments therefore need to determine how multilateral negotiations on the specifics of regulatory regimes could be helpful in the pursuit of such reforms. In practice, unilateral action would be required in any event; the challenge is to use the multilateral process to support beneficial reforms. A key question is whether rule-making efforts to accommodate the new issues be de-linked from the agricultural negotiations on border measures? A suggestion by Josling (1998) is to incorporate all the new issues as they apply to agriculture under the three headings used in the Uruguay Round Agreement on Agriculture, viz. import market access, export subsidies, and domestic support. While such an approach may be necessary if the next round is confined to just agriculture and services, or may be more expedient, it simply prolongs the day when agriculture is fully integrated with other sectors in the WTO. While that separation remains, WTO rules are less clear, and exceptional (i.e., less-liberalizing) treatment is encouraged. Hence a more generic approach to the new issues is worthy of consideration. Such as appraisal requires finding a way to determine whether domestic policies that have detrimental effects on foreign suppliers can be justified on public interest grounds. More specifically, it can be asked whether a less trade-distorting policy instrument can be identified to achieve a particular objective at no greater cost. If so, the presumption would be that the measure should be contestable by other WTO members.

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India is one of the founding members of the World Trade Organisation (WTO) and participation in the WTO rule based system implies greater stability, transparency and predictability in the governance of international trade. The importance of WTO in promoting multilateral trade is being increasingly acknowledged. The WTO rules envisage non-discrimination in the form of national treatment and most favoured nation (MFN) treatment to our exports in the markets of other WTO members. National treatment ensures that our exports to other member countries would not be discriminated vis-a-vis their domestic products. MFN treatment likewise ensures non-discrimination among various members in their tariff regimes and also other rules and regulations. Emerging from continued discussions in various multilateral for a , developmental issues along with trade related issues are being increasingly focused at the international level. Poverty concerns of developing countries along with development and trade policies are also being given cognisance. Need has been felt for integration of trade policies with development strategies, increasing
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support to areas of finance and debt relief, recognising the importance of technology for development, improvement in market access for developing countries in sectors like textiles, clothing and agriculture, and providing better access to the dispute settlement mechanisms for these countries. The issue of abuse of the anti-dumping procedure*, the problems of rules of origin criteria, technical barriers to trade, regional trading blocs, etc., are also being considered at various levels in the WTO. The Government of India has taken several steps to implement the policy commitments made under some of the agreements, particularly under the Agreement on Tariffs and Quantitative Restrictions Agreement on Agriculture (AoA), Trade Related Intellectual Property Rights (TRIPs), Trade Related Investment Measures (TRIMs), General Agreement on Trade in Services (GATS), apart from others. A strategy for tariff negotiations is, however, required. The additional 'non-trade' issues relating to transparency in government procurement practices trade and competition policy, trade and environment, and trade and labour standards proposed in the Singapore and the Geneva Ministerial need to be addressed for negotiations. The commitments regarding the technical barriers to trade, social agenda covering labour standards and environmental and phyto-sanitary issues also require establishment of certain national standards and technical regulations in a standardised and transparent system. At the same time, there are some issues on which India has expressed certain reservations. These are: During the implementation of WTO agreements in the last six years, India has experienced certain imbalances and inequities in the WTO agreements. It is found that some developed countries have not fulfilled their obligations in letter and spirit of the WTO agreements, and many of the Special and Differential Treatment clauses, in favour of developing countries, added in various WTO agreements have remained in operational. Taking advantage of the exception clauses provided in the WTO, most industrialised countries are still enforcing various regulations on foreign producers and suppliers. Extending the scope of the investment regime in WTO beyond Trade Related Investment Measures and General Agreements on Trade in Services, is not appropriate. A multilateral framework cannot guarantee an increase in FDI inflows although it threatens to adversely affect the quality of the inflows. There are also other asymmetries present, as the WTO does not address the responsibilities of
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corporations which often impose trade restrictive clauses on their subsidiaries. WTO has not been able to ensure abolition of non-trade barriers being imposed on labour and environmental considerations, including the linkage in certain Generalised System of Preferences (GSP) schemes to these issues. The present negotiations strategy is based on the decisions taken at the Doha Ministerial in November 2001. The Doha Declaration focused mainly on TRIPs agreement, public health, trade and environment and the implementation related issues and concerns. Elaborate timetables on work programme for current negotiations in agriculture and services and other issues have been worked out. The Doha Conference presented mixed results for India. India's main concern was to speed up implementation of various agreements and to undo the imbalances and inequities present in some WTO agreements. From India's point of view, faster removal of the textile quotas maintained by developed countries like the USA was the most important implementation issue, which was, however, met with limited success. As far as environmental issues are concerned, the Doha declaration has mandated negotiations to clarify WTO rules in the light of multilateral environmental agreements. These negotiations could lead to developed countries raising barriers against goods from developing countries on the pretext of environmental protection. India had also reservations on starting negotiations on four new 'non-trade' areas, namely, multilateral investment, global rules on competition, transparency in government procurement and trade facilitation, i.e., framing of uniform customs procedures for clearance of goods. India could secure only a two-year respite and the study process would continue for two more years, i.e. up to the Fifth Ministerial Conference, when a decision about negotiations will be taken on the basis of an explicit consensus. Apart from mandated negotiations in agriculture and services where the process has already started, negotiations on market access for non- agricultural products is quite important for India, as reduction or elimination of tariffs, tariff peaks and tariff escalation as well as removal of non-tariff barriers will be quite helpful in exports. India would, of course, have to make offers even though the negotiations will be carried out under less than full reciprocity as far as developing countries are concerned. The other area where action is required is in regard to extension of protection of geographical indications to products other than wines and spirits under Article 23 of TRIPs and the relationship between TRIPs and the Convention on Biological Diversity (CBD), and Traditional Knowledge (TK) under Article 71.1. The process of legislation in regard to geographical indications needs to be completed. In the area of TRIPs and access to medicine, where additional flexibility is provided in separate ministerial declarations in terms of compulsory licensing and parallel imports, India can benefit in terms of lower prices of crucial life saving drugs and even promoting exports of pharmaceutical products. India and other developing countries should now ensure an average balance of reciprocity in these negotiations. There is need for a continued effort to handle some of the complex issues, as per international requirements as well as our domestic resources and other constraints, during the Tenth Five Year Plan.
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Infrastructure in relation to post-harvest technology, including rural communication, godowns, refrigerated storage, and transportation arrangements for perishable commodities is inadequate. The World Trade Agreement stringent requirements of sanitary and phytosanitary measures are yet to be understood. There is an urgent need to improve yield per drop of water. During the last few decades, farmers in various countries have shifted from flow irrigation to sprinkler, drip, and now membrane irrigation. Plant-scale agronomy is replacing field-scale agronomy. Precision farming techniques need to be adopted. Contract farming and corporate farming, with increased investments needs to grow. There is indeed an urgent need to quickly implement the Plant Variety Protection and Farmers Rights Act as well as Biodiversity Act without delay. Indian farmers need adequate information. Computerized systems of information need to be developed and the benefits of cyberspace should be extended to poor farm families. Given the complexities and escape routes available to the western world in the implementation of the agreements, one could question the methodologies followed in the reduction commitment norms. Market-access commitments have been tampered with dirty tariffication. Moreover, already low rates of tariffs have been reduced as compared to a reduction in high tariff rates.35 On the other hand, some of Indias low tariff bindings may be renegotiated. Calculation of price support within the product-specific AMS is not clearly defined in
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the text. Therefore, it would be a good idea to bring a consensus among the member countries on this issue. Developing countries that have net-taxed their agriculture, may ask for credit of some sorts for having negative AMS. Further, blue-box policies may be suggested to be eliminated altogether or moved out of the exemptions for the calculation of current AMS. Moreover, along with export subsidies, export credits and guarantees may also be suggested to be brought under reduction commitments. The SPS and TBT agreements do affect agricultural markets. Modernizing our agricultural processing will not only enhance our export-market potential, it would also reform domestic food quality. Understanding the direction and magnitude of the effects of WTO agreements on Indian agriculture is a very difficult proposition. Some attempts have been made in the past to quantify the effects of the WTO Agreement and trade liberalization on Indian agriculture. While the direction of the gains to Indian agriculture may be correct, one may not agree with the assumptions of their models, and the magnitude and distribution of these gains. In the presence of imperfectly competitive export market structures, the increase in terms-of-trade for Indian agriculture may not be as high as predicted by the computable general equilibrium studies that implicitly assume perfectly competitive markets. Whatever little improvement may occur in the terms-of-trade, it will have negative or at best very little effect on farmers welfare, as supply response to terms-of-trade improvement is ambiguous. On this ground, developing countries may ask for further and sharp reductions in the export subsidies and domestic support given by the developed world. Indian agriculture will stand to gain through improvements in irrigation, transport, agricultural extension services and research. Expenditures on such items are exempt from domestic support reduction commitments under the green-box policies. In the emerging post-WTO world economic order, direct competition from imported goods cannot be prevented. With the eventual dismantling of the quantitative restrictions and reductions of industrial tariffs, our choice of warding off foreign competition is nothing more than wishful thinking. So, we must focus on how India can use the changed conditions to earn benefits. For this, first and foremost the economy has 35 Therefore, the Swiss Formula may be suggested to reduce higher tariffs by steeper cuts. to identify and develop a modern infrastructure to facilitate agricultural exports. The post-harvest technology and the storage facilities need to be upgraded. There is a need to commercialize the farm operations by improving the management and marketing techniques. This can be achieved by establishing mutually beneficial linkages with the industry. Thus, there is plenty of scope for India to change from a mere producer to an exporter of value-added and processed farm products and high quality seeds. Under the existing circumstances, the liberalization of world trade in agriculture will benefit developed countries more than developing countries. Given the conditions of high tariffs in the developed world and low or nil tariffs in developing countries, the removal of Quantitative Restrictions on agricultural commodities will tilt the balance of global trade in favour of the developed nations with detrimental effects on the producers in Third World countries. India must be alert to the implications of the WTO and its policies, and decide its own national priorities while taking policy decisions in the future. It is our duty not only to protect our national interest but also to promote it so as to take advantage of the situation. The situation is inescapable but there is scope to manipulate it in the national interest.

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G L
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O S S A R Y O F K E Y P O I N T S O N P R O D U C TI
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V IT Y S U B J E C T

WO RL D TR AD E OR GI NA SA TIO N:

An inter nati onal orga niza tion deal ing with the
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glob al rule s of trad e bet wee n nati ons. Its mai n func tion is to ensu re that trad e flow s as smo othl y, pred icta bly, and freel y as poss ible. WT O. An
inte rna tion al age ncy

whi ch
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enc oura ges trad e bet wee n me mbe r nati ons, adm inist ers
glo bal tra de

and reso lves disp utes whe n they aris e. INT ELL ECT UAL PRO PER TY: Intell ectua l prop erty right s
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can be defin ed as the right s given to peopl e over the creati ons of their mind s. They usual ly give the creat or an exclu sive right over the use of his/h er creati ons for a certai n perio d of time. URU GUA Y
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ROU ND: The Urug uay Rou nd was the 8th roun d of multi latera l trade negot iatio ns (MT N) cond ucted withi n the fram ewor k of the Gene ral Agre emen t on Tarif fs and Trad e (GA TT), span ning from 1986 to 1994 and
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embr acing 123 count ries as "cont racti ng parti es". The Roun d trans form ed the GAT T into the Worl d Trad e Orga nizati on. The Roun d came into effec t in 1995 and has been impl emen ted over the perio d to 2000 (200
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4 in the case of devel opin g count ry contr actin g parti es) unde r the admi nistra tive direc tion of the newl y creat ed Worl d Trad e Orga nizati on (WT O). GEN ERA L AGR EE ME NT ON TAR IFFS
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AND TRA DE: Gene ral Agre emen t on Tarif fs and Trad e. Treat y orga nizati on affili ated with the Unite d Natio ns whos e purp ose was to facili tate inter natio nal trade . The prim ary actio
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ns of the orga nizati on were to freez e and

redu ce tariff

level s on vario us com modi ties. GAT T was creat ed in 1947 , and was origi nally inten ded to beco me a part of the Inter natio nal Trad e Orga
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nizati on (ITO ); howe ver, the ITO faile d to be creat ed, so the GAT T was left as an indep ende nt orga nizati on. In 1994 , GAT T was super sede d by the WT O.

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TRA DE NEG OTI ATI ONS : The Trad e Nego tiatio ns Com mitte e (TN C) opera tes unde r the autho rity of the Gene ral Coun cil. It was set up by the Doha Decl arati on, whic h in turn assig ned it to creat e subsi
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diary negot iatin g bodie s to handl e indiv idual negot iatin g subje cts. THE AGR EE ME NT ON AGR ICU LTU RE: The Agre emen t on Agri cultu re is an inter natio nal treat y of the Worl d Trad e Orga nizati on. It
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was negot iated durin g the Urug uay Roun d of the Gene ral Agre emen t on Tarif fs and Trad e, and enter ed into force with the estab lishm ent of the WT O on Janu ary 1, 1995 . TAR IFF: Tarif f tax on impo rted
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and, more rarel y, expo rted good s. It is also calle d a custo ms duty. Tarif fs may be distin guish ed from other taxes in that their pred omin ant purp ose is not finan cial but econ omic not to
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incre ase a natio n's reven ue but to prote ct dome stic indus tries from forei gn comp etitio n. For that reaso n, prote ctive tariff s, as they are often calle d, are oppo sed by advo cates of trade free.

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A BB R E VI A TI O NS

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WT O: worl d trade orga nizati on. GAT T: gener al agree ment on tariff s and trade . AOA : agree ment on agric ultur e. DSB : dispu te settle ment boar d. AMS : aggre gate meas urem ent supp ort.
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EEC : Euro pean econ omic com muni ty. AP MCs : agric ultur al prod uce mark eting com mitte es. SPS: sanit ary and phyt osani tary stand ards. STE s: statetradi ng entiti es. MF N: most favo ured natio n.
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TRI Ps: trade relate d intell ectua l prop erty right s. TRI Ms: trade relate d inves tmen t meas ures. GAT S: gener al agree ment on trade in servi ces. GSP: gener alise d syste m of prefe rence s. CBD : conv
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entio n on biolo gical diver sity. TK: tradit ional know ledge .

R E F E R E N C E S
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Internet Reference s

www.pres ervearticle s.com

www.liber alsindia.c om

www.ter mpaper warehou se.com

www.bign erds.com

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