NEW DELHI: India is supportive of initiatives aimed at facilitating and easing investment flows to developing and poor countries, a senior government official said on Wednesday. However, he maintained that the World Trade Organization (WTO), as a trade body, is not the appropriate forum for such matters.
The Investment Facilitation for Development (IFD) agreement proposal, backed by 128 WTO members, aims to enhance the transparency of investment regulations to make countries more efficient and attractive to foreign and national investors.
Apart from making foreign direct investment (FDI) flow easier, the idea is also to aim for higher-quality investment. This is at a time when many developing countries are grappling with weak growth and high inflation.
“On the IFD agenda, India supports initiatives that facilitate investment flows into developing countries, including least developed countries (LDCs),” the commerce department said in a statement ahead of the 14th ministerial meeting scheduled from March 26-29 at Yaoundé, Cameroon.
India has not joined the agreement and has also opposed it since it believes it will dilute the multilateral nature of the WTO.
The group wants to bring the proposal through Annexure-4 of the WTO, under which the proposal would be binding on only the signatory members and not on those who are opposed it.
Other than India, several other countries have voiced their concerns against the China-led IFD proposal.
“(There is) no change in our position,” a senior government official told Business Standard.
Delhi-based think-tank Global Trade Research Initiative (GTRI) said at Ministerial Conference 14 (MC14), India is expected to face strong pressure to accept IFD, setting a precedent for future plurilateral agreements.
“India argues that plurilateral agreements undermine the balance of interests in WTO negotiations between developed and developing countries. It warns such deals could sideline issues like farm subsidies and create a two-tier WTO dominated by major economies,” it said.
The commerce department statement further said that a permanent solution on public stockholding remains ‘critical’ for India. This is given that a significant proportion of farmers are low-income and resource-constrained, relying on the minimum support price (MSP) system for price assurance and livelihood security.
On fisheries subsidies, India has advocated for a balanced approach that addresses sustainability concerns while protecting the livelihoods of fishers.
India has also emphasised that distant-water fishing nations should undertake proportionate responsibilities, including progressive reduction of their distant-water fishing capacities.
With regard to the e-commerce moratorium, India has highlighted the rapidly-evolving nature of the digital economy, particularly in the context of emerging technologies. And, also the ‘need for policy space to enable countries to effectively harness these developments’, it said.
“India’s engagement at MC14 will remain constructive, balanced, and development-oriented. India will continue to support meaningful WTO reforms aimed at strengthening the multilateral trading system, while keeping development concerns at its core. The country will emphasise the importance of respecting the multilateral mandate of the WTO, prioritising food security, safeguarding the livelihoods of small farmers and fishers. And, also ensuring adequate policy space for developing economies, particularly in emerging areas such as digital trade,” the statement said.
At the 14th MC, the Indian delegation will be led by commerce and industry minister Piyush Goyal. The delegation includes senior officials from the department of commerce, officers from the permanent mission of India in Geneva, representatives from other stakeholder government departments, as well as technical and legal experts.
Source: Business Standard
