Why the WTO failed once more?

The World Trade Organisation's (WTO) trade talks held in Geneva July 21-31, collapsed on the penultimate day for lack of an agreement on issues that have plagued the Doha "Development" Round of the trade talks since its very beginning. These are the issues of subsidies and Special Safeguards Mechanism (SSM), i.e. the extent to which countries with predominantly agricultural economies would be able to protect themselves from import surges through "safeguard mechanisms." While the US and EU pointed fingers at India and China, for the breakdown, it is reported that in fact, it was the US which refused to negotiate any further because it did not want to make any commitment to cut its massive federal subsidies to cotton growers.

This is not the first time that the trade talks have collapsed. The Doha "Development" Round was created to maintain the credibility of the multilateral trade talks when the massive popular opposition from the world's people at Seattle forced the trade talks of the Uruguay Trade Round to a dead end. In a bid to revive the negotiations, the next round was launched under the name "development" round, where supposedly the concerns of the less developed capitalist countries would be given greater consideration in the drawing up and implementation of agreements. However, merely calling it the "Development" Round did not change anything. Talks floundered in Cancun, Mexico in 2003, on the attempt to achieve an agreement on agricultural issues. Now the member countries are unable to reach anything close to consensus on the mechanisms for implementation of the Agreement on Agriculture that was drawn up in 2005 in Geneva.

One of the most important questions on which there is a deep division between different groupings of countries is trade in agriculture and subsidies related to agriculture. The United States and the European Union spend billions of dollars annually in the form of domestic subsidies to agricultural producers. This guarantees cheap supply of agricultural products for the giant multinational agro-business corporations, enabling them to capture the world market for food and other agro-products. The US and the EU want clauses in the WTO agreement which would deny the right of countries which are heavily dependant on agriculture to employ any kind of restrictions to resist dumping of agricultural commodities either through quantitative limits on the imports, or through tariffs.

At the recent Geneva meeting, it seems that the US on the one hand and India and China on the other were agreed to a clause that would say at what point the countries facing dumping, could exercise right to restrict imports of agricultural commodities. According to reports there was a disagreement on the "cutoff level" and when the safeguard mechanism to protect the countries agricultural producers could be invoked. The US proposal was that such countries must establish 'demonstrable harm' to food security, livelihood concerns and rural development before the agreed upon safeguard mechanism could be put to use! This was naturally not accepted by the representative of the Indian government.

Narrow corporate interests drive the negotiations

The regular and almost predictable collapse of the trade negotiations is because the WTO is driven by the interests of the biggest capitalist corporations to expand their markets. These "negotiations" are an attempt to legitimise the plunder of the world's peoples through trade. Since each country or group of countries is competing for the world's markets and there is much at stake for the corporate interests they are defending, there is intense contradiction and competition. This is so even within groups of countries.

The governments of different capitalist countries participate in these negotiations on behalf of the corporate interests that dominate their countries. The Ministerial talks are far from transparent and inter imperialist, inter monopoly conflicts are settled by deals struck by various governments behind the backs of the people. In fact, most of the negotiations and deals in the WTO are settled in cloak and dagger meetings between countries representing this or that monopoly interest and then pushed through in the public forums. Many smaller and less developed countries have almost no say in the WTO negotiations.

India's stand at Geneva

India is one of the important players in the ongoing WTO negotiations. At the head of a vast country both in terms of size and population, with a relatively big economy which is growing, and massive agricultural production, India's stand on agricultural trade is of greatest concern to the giant international trading corporations in agro-commodities. India is potentially a huge market for agro-commodities. It is also of great concern to the corporate houses of our country which have entered or are entering the field of agriculture and trade in agro-commodities. India's stand on trade in agriculture also naturally impacts on the livelihood of the farmers of our country. 

The Indian government represents the interests of the corporate houses. These corporate houses want to establish their control over Indian agriculture, both production and trade, to ensure maximum profits for themselves. They are also eyeing the export market. Their interests sometimes coincide with and at other times clash with the interests of the foreign agricultural trading monopolies. They are using their control over the government of India to push through their agenda in the trade negotiations. This could be the reason why the Indian government, at the recent negotiations, refused to get tied down to US demands. The stand of the Indian government at Geneva confirms that the Indian bourgeoisie is vigorously pursuing its imperialist agenda of emerging as a world class imperialist power.

The bourgeoisie always presents its own narrow interests as the interests of the country. It comes as no surprise Commerce Minister Kamalnath is promoting India's positions in the WTO negotiations as in defence of India's farmers. Nothing could be further from the truth. Just like America's agricultural subsidies are actually subsidies to the giant food companies, not to its farmers, so too Indian government's stand is dictated by the interests of the Indian corporate houses. The interests of the farmers of our country are not what is driving the Indian government in the negotiations. There can be no illusions on this score.