World trade bodies target Narendra Modi, ask if India is really open for business.

With India firm on its Trade Facilitation Agreement (TFA) stand, top global trade bodies and experts said this policy is quite contrary to the promise made by the new government in India led by PM Narendra Modi that it is open for business.

"India's move to disengage from the trade facilitation agreement will confirm the belief of many that India is simply not ready for larger trade-expanding agreements. "Until this week, it was always possible to argue that India upholds the multilateral obligations it commits to; by next week, however, it may cease to be a statement of fact," said Alyssa Ayres, Senior Fellow for India, Pakistan and South Asia at the Council on Foreign Relations, a major American think-tank.

Last week, India told the World Trade Organization (WTO) that it would not sign the TFA unless its concerns on food security are addressed, to which the US expressed its disappointment.

"New Delhi's stance not only puts up a roadblock on global trade, but will effectively halt any efforts to envision a larger ambition for the US-India economic relationship — which badly needs one — by signaling that India at present does not want to stand with the global free and open trading system," Ayers said.

"This is not India against the West but against itself and the world, backing away from the terms of a deal it participated in designing as recently as December," Ayers added. The International Chamber of Commerce (ICC) said it is rallying its global network to highlight the adverse consequences of missing a first deadline to implement the WTO Trade Facilitation Agreement.

"The ICC action follows reports that a small number of WTO members, including India, have proposed postponing implementation until negotiations on other aspects of the accords reached in Bali last year are complete," it said.

In a letter published in Financial Times, ICC said it was "deeply concerned" by the course of events at the latest WTO meeting in Geneva. Harold McGraw, ICC's chairman, and John Danilovich, its secretary-general, said failure to meet the July 31 deadline would mean missing an opportunity to inject much-needed growth into the global economy.

"In Bali last December statesmanship prevailed. It must do so again in Geneva this week. If political posturing proves the short-term victor, we all – businesses, consumers, governments – will lose out in the long run," they said.

In a statement, the National Foreign Trade Council (NFTC) warned that the failure to advance the Trade Facilitation Agreement as promised would do lasting damage to the multilateral trading system.

"It is ironic that the very same countries who criticise exclusive trade negotiating groups, like the Trans-Pacific Partnership and Trade in Services Agreement, the loudest seem ready to ensure that those smaller groupings are the only viable paths forward for trade negotiators," said NFTC Vice President for Global Trade Issues Jake Colvin.

In an editorial Bloomberg alleged that New Delhi's stand on TFA is in contradiction to the promises of openness and liberalisation made by the new government. "India's new prime minister, Narendra Modi, promised to give the stalling Indian economy a good, firm push. Under his leadership, he said, India would be open for business. There's little sign of it so far," the editorial said.

"Modi should reflect on how few countries rallied to support him last week. When Bolivia, Cuba and Venezuela think you're in the right, you might want to think again. This trade deal was supposed to be final on July 31. India should let it happen," the Bloomberg editorial said. US accuses India, other nations of revisiting TFA commitment

Without naming India directly, a top US trade official has alleged that a few nations are revisiting their commitment to implement WTO's Trade Facilitation Agreement, but hoped for a consensus before the July 31 deadline for signing the pact.

US Trade Representative Mike Froman told a Washington audience yesterday that the credibility of the World Trade Organization as an institution rests on swift implementation of the TFA.

In his remarks at the Brookings Institute, Froman did not directly identify India as the one blocking TFA, but his reference was only towards India and the few other countries like Cuba, Bolivia, Venezuela and Ecuador, which have supported New Delhi's stand for delay in adoption of TFA, which was negotiated upon in Bali last year.

Last week, India told the WTO in Geneva that it would not sign TFA unless its concerns on food security are addressed, to which the US had expressed its disappointment.

"Unfortunately, a couple countries now appear to be revisiting their commitment to implement the WTO Trade Facilitation Agreement later this week," Froman said. "The first fully multilateral trade agreement in WTO history, the TFA would make border procedures more efficient, and in doing so, cut trade costs by almost 14.5 per cent for developing countries and 10 per cent for developed countries," he argued.

Froman said: "We are hopeful about achieving a consensus, because alongside the economic stakes, the credibility of the WTO as an institution rests on the swift implementation of the Trade Facilitation Agreement.

"Bali breathed new life into the multilateral trading system; it would be short-sighted – especially for a couple developing countries – to block the implementation of the Trade Facilitation Agreement this week, putting at risk again the continued viability of the multilateral system and undermining the development efforts of so many countries reliant on that system."

Source : financialexpress.com