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Volte face on TFA

Volte face on TFA
Highlights

Nearly two years after the Bali agreement of World Trade Organisation (WTO), the Union Cabinet has approved the Trade Facilitation Agreement (TFA). This deal is intended at easing customs procedures to give an impetus to free trade.  Trade facilitation means expediting the movement, release and clearance of goods, including goods in transit for international trade. 

Nearly two years after the Bali agreement of World Trade Organisation (WTO), the Union Cabinet has approved the Trade Facilitation Agreement (TFA). This deal is intended at easing customs procedures to give an impetus to free trade. Trade facilitation means expediting the movement, release and clearance of goods, including goods in transit for international trade.

The WTO claims that full implementation of this agreement would result in increase of global merchandise exports by up to one trillion dollars. It may be recalled here that in the past India under NDA had opposed the TFA on the demand for permanent solution to subsidise farmers and public stockholding to ensure food security to its poor.

But, surprisingly, now India approved the TFA without finding any permanent solution to the question of country’s right to hold public stocking of food grains so vital for ensuring food security to the poor and income security for the farmers. The United States has only assured India that it will not raise any objections at WTO Dispute Settlement Mechanism till a permanent solution is arrived at.

This is only an assurance but not a solution to India’s concerns. Still, the Government of India in its own wisdom decided to give this concession to the richer nations by acceding to TFA even when its own concerns are not adequately addressed. For instance, the developed nations continue to oppose Indian export of subsidised food grains. The richer nations allege that allowing India such exports will distort market prices.

On the contrary, the developed nations like United States and other Western nations continue to massively subsidise their farmers putting the interests of farmers belonging to developing nations like India in a serious jeopardy. The Narendra Modi government should explain to the nation the reasons behind its somersault on an issue so crucial to the lives and livelihoods of millions of Indians.

Assuming that the TFA ensures massive increase in global trade, the trade facilitation would prove to be a mere hallucination for developing economies like India, given the international trade and economic order highly skewed in favour of the affluent nations. Even the Modi government itself stated many a time at the WTO meets the same concerns over the richer nations appropriating the so-called global free trade.

Thus, the massive expansion of global trade is not necessarily a win-win situation for both the developed and the developing economies due to protectionism and neo protectionism of the global North. In fact, whether or not there exists a TFA, India as part of its ongoing economic liberalisation programme has been opening up its economy to the world and initiated a series of measures on doing business with ease.

But the opulent nations refuse to provide access to their economies for even the emerging economies like India, besides attacking our programmes of food security and even the feeble assistance to farmers. Therefore, further concessions to the developed countries by acceding to TFA are reprehensible.

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