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'WTO cannot progress without India'

George Iype in Hyderabad

World Trade Organisation Director General Mike Moore says the booming information technology sector is a powerful reason for India to press for a new round of negotiations and a fresh set of rules in the global trade body.

Addressing the seventh Partnership Summit organised jointly by the Confederation of Indian Industry and the Andhra Pradesh government in Hyderabad on Thursday, Moore said the WTO can help eliminate import duties of computer technologies, peripherals, telecom equipment and e-commerce related gadgets.

"India has a vital role to play in the WTO. The WTO cannot progress without India. And India needs the WTO," he said.

"India has a huge interest in the IT sector. It is one powerful reason why India should be fighting for a new round of negotiations at the WTO. Throw in the prospect of freer trade in agriculture and cuts in industrial tariff and the case becomes all the more compelling," Moore said.

The WTO chief estimated that the annual gains to India from a new round of negotiations centred on the IT sector could top US $ 11 billion, raising the country’s national income by 4.4 per cent.

Stressing that a strong push for a new round of negotiations from India could be decisive for the WTO. "We are approaching a critical juncture at the WTO. Over the years, we have successfully rebuilt confidence in the WTO. We have purged the bad blood that poisoned relations among member governments and we have demonstrated that WTO can function effectively and fairly," he said.

The WTO chief stated that India's outstanding success in the computer industry shows how information technology and open trade together offer new opportunities for people to better their lives. "Thanks to strong political leadership, economic liberalisation and the inherent entrepreneurial skills of Indian business people, the country's economy is growing at over 7 per cent an year," he said.

Moore said India offers a powerful example to prove that globalisation has the potential to lift more people out of poverty more quickly than at any time in human history.

However, he warned the government, captains of industry and IT leaders about the challenges that lie ahead for India. "There are more than a billion people in India. But the software industry employs a mere 340,000 of them. Indian software programmers who work for US companies using the Internet are the exception, not the rule," Moore pointed out.

"Most of those who are literate in India do not have access to the Internet. In India, there is one Internet host for every 55,000 people. In the United States, there is one for every seven people. Clearly, it is a major challenge, to make sure developing countries are not left behind in the Internet economy," he said.

The WTO chief stressed that the responsibility of governments these days is to prevent the digital divide between the North and the South, the developing and the developed countries. The WTO, he said, has been working to help the world's poorest countries reap greater benefit from the world trading system. "As a result of our tremendous efforts last year, 27 countries made improved market-access offers. We want progress for all our 140 members," he said.

Moore made sure that the WTO urgently needs a new impetus to broaden the negotiating agenda. "America's long economic boom is drawing to a close, with potentially worrying consequences for the world economy. Further trade negotiations are an insurance policy against pleas for protection when economies turn down," he said.

Calling for India's leadership in guiding the WTO, Moore said the developed world looked to India for leadership in the past. "Now the whole world recognises India's unique position economically and politically. We need your advice, leadership and enthusiasm if the WTO is to advance in all fronts," he added.

Moore and his successor-designate Supachai Panitchpakdi, Thailand's deputy prime minister and commerce minister, have flown to Hyderabad to attend the Partnership Summit.

Moore and other top WTO officials have been talking to Indian leaders for many months now to strike a deal so that India shelves the contentious issues that resulted in the failure of the Seattle round of talks in 1999.

The WTO is scheduled to hold its fourth ministerial conference in Geneva later this year. But a successful conference and new round of negotiations will be possible only if India agrees to put on hold the issues of labour and environment on the backburner.

So far India has been refusing to link labour standards and environmental issues to trade, saying non-trade issues cannot be dragged into WTO negotiations.

The WTO chief and his successor are eager to thrash these troublesome issues out with India. Moore and Panitchpakdi met Commerce Minister Murasoli Maran in New Delhi before embarking for Hyderabad. They will meet Prime Minister Atal Bihari Vajpayee later this week to discuss the issues.

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