Director-General of the World Trade Organisation Ngozi Okonjo-Iweala speaks during the opening ceremony of the WTO ministerial meeting in Abu Dhabi, United Arab Emirates on February 26, 2024.
| Photo Credit: Reuters

Trade in services such as movement of skilled professionals accounts for over 20% of the global commerce but the sector is still not getting sufficient attention in the negotiations of the WTO, according to experts and officials.

The experts also said that developed or rich member nations of the World Trade Organisation (WTO) are only interested in pushing their own non-trade agenda and not focusing on issues which really need special focus of the Geneva-based multi-lateral body.

Also read: WTO MC13 | What’s on the agenda for India?

Trade Ministers and officials of the 166-member WTO are gathered here to discuss wide ranging issues such as agriculture, and fisheries subsidies.

The 13th ministerial conference (MC13) of the WTO on Feb. 28 entered the third day. MC is the highest decision making body of the global trade watchdog.

“There are enough issues related to trade are there to discuss in the WTO like sanitary and phytosanitary issues, technical barriers to trade and mutual recognition agreements (MRAs), but the developed nations want to push new issues,” an international trade expert, who did not wish to be named, said.

Sharing similar views, an official said that there are no discussions on services trade in terms of how this can be improved.

“There are no talks on that. They are not talking about MRAs, about mobility issues, how the mobility issues will be tackled. They are not discussing the issues which are restrictive for the developing nations,” the official said.

Another expert said that issues like the movement of care-givers from emerging nations to rich nations needs attention as countries like India have demographic dividend for another 25 years and the EU has demographic deficit.

“But they are not willing to accept immigration or mobility rules,” the official added.

Economic think tank Global Trade Research Initiative (GTRI) said that services trade account for over 20% of the world trade and despite that it is mired in non-transparent domestic regulations that impede the cross-border trade.

“It receives far less attention at WTO meetings resulting in insignificant progress on critical issues of importance to developing countries. The only issue that gets priority treatment is extension of the moratorium on customs duties on electronic transmissions as it is of interest to the USA, EU and other developed countries,” GTRI Founder Ajay Srivastava said.

The customs duty moratorium is a temporary measure to prevent countries from imposing import taxes on digital products like software, music and movies.

India, Indonesia, South Africa and many other countries are opposed to the extension which has been renewed every two years since 1998.

“However, it is expected that extension may be agreed for another two years in the spirit of bonhomie and consensus building,” Mr. Srivastava said.

He added that so far there is no progress in the MC13 on a proposal of the G-90 (group of 90 nations which consists of developing countries) for enhancing existing flexibilities and exemptions for developing countries in the General Agreement on Trade in Services (GATS).

“This could involve longer transition periods for implementing GATS commitments, greater flexibility in domestic regulations affecting services and technical assistance, and capacity building for developing countries,” Mr. Srivastava said.

India had earlier floated a proposal on trade facilitation in services (TFS).

India’s objective behind this proposal is to initiate discussions on comprehensively addressing the numerous barriers — both at the border and behind it — that hinder the full potential of services trade across all modes of supplies.

“The TFS draft emphasises the need for a counterpart agreement in services, which could lead to a reduction in transaction costs associated with unnecessary regulatory and administrative burdens related to trade in services,” he added.

By proposing rules for the four modes of services categorised under the WTO’s General Agreement on Trade in Services (GATS), India aims to facilitate smoother and more efficient cross-border services trade.

India always pushes for smooth cross-border movement of skilled service providers such as IT and medical professionals, teachers and accountants.

India plans to protest the European Union’s proposed carbon tax at the next WTO meeting. File
| Photo Credit: Reuters

India plans to protest the European Union’s proposed carbon tax on imports of steel, iron ore and cement at the next meeting of World Trade Organization (WTO) later this month, saying it would emerge as a new trade barrier, two Government sources said.

India, along with South Africa and other like-minded countries, is planning to push its demand to rein in the European Union’s unilateral measure at the WTO’s Ministerial Conference (MC13), to be held in Abu Dhabi from Feb. 26 to 29, senior officials said.

“Any unilateral measures taken to combat climate change should not constitute a means of arbitrary or unjustifiable discrimination or disguised restriction on global trade,” one of the officials, with direct knowledge of WTO discussions, told reporters on February 7.

India had earlier decided to file a complaint in the WTO over the EU’s proposal to impose 20-35% tariffs on imports of high-carbon goods like steel, iron ore and cement, while raising the issue with EU officials in bilateral meetings.

EU’s carbon tax

The EU has said it designed the Carbon Border Adjustment Mechanism (CBAM) carefully so that it was compatible with WTO rules, applying the same carbon price on imported goods as on domestic EU producers.

India and China are among several countries that have aired concerns within the WTO over the EU’s carbon tax designated to prevent European industry being undercut by cheaper goods from countries with weaker environment rules.

“Climate change is a real issue, and knows no territorial borders,” said the second official. The officials declined to be identified according to government policy on discussions at international forums.

The Commerce Ministry, which is leading India’s negotiations at the WTO, declined to comment. The official said developed countries had missed an agreed annual target of mobilising $100 billion by 2020 for climate action in developing countries.

New Delhi has also opposed EU regulations banning the import of products based on deforestation in the country of origin, likely to hit billions of dollars worth of exports from India.