India and the US have the political will to conclude the long-delayed World Trade Organisation’s Doha round, Simon Crean, Australia’s trade minister, said on Wednesday.
Speaking on the eve of a meeting of 39 trade ministers in New Delhi, Mr Crean said the talks were in their final stage and called for an intensification of negotiations. “So far as the round is concerned, we are very close to its conclusion,” he said. “We are now in the end-game of the Doha negotiations.”
The Australian minister’s emphasis on the political will of the newly elected government of Manmohan Singh and the administration of Barack Obama is important. India’s agricultural sector, a key concern of its negotiators, is facing one of its worst monsoons for 30 years, while the US economy is reeling from the global financial crisis. These adversities have led some experts to believe that a deal is out of reach.
Mr Crean said there was a wide acceptance among world leaders that a trade deal would act as a stimulus to the world economy and avoid a damaging shift to more protectionism. Leaders at the Group of 20 leading nations, meeting in Pittsburgh in the US this month, would seek the kind of co-operation they had found over fiscal and monetary responses to the global economic crisis in the trade arena. However, he recommended that to reach an agreement some “hard political issues” might need to be taken out of the multilateral framework and agreed bilaterally.
“This isn’t a conclusion that’s going to happen if one side thinks it’s only the other side that has to give. Both sides, if they’re to take, have to give,” he said. Studies showed a Doha deal could inject $300bn-700bn (€210bn-€490bn, £184bn-£430bn) a year into the global economy. A report by the Peterson Institute, a Washington-based think-tank, estimated that a 10 per cent reduction by big economies to services barriers would increase global exports at least $56bn a year and gross domestic product by $100bn.
Although Indian policymakers have complained about a rise in protectionism among the western trading partners of Asia’s third largest economy and an upsurge in non-tariff barriers, Delhi has signalled over the past two months a renewed commitment to conclude the Doha round, following the appointment of Anand Sharma as commerce minister.
