India's core concerns in the Doha market access for industrials have been given a short shrift in the second revised text issued on Monday.
New Delhi has all along demanded that the principle of less-than-full reciprocity -- which implies that industrialised countries take bigger tariff reduction commitments than developing countries -- must be the cornerstone of Doha non-agriculture market access modalities.
Besides, India demanded that the formula to cut industrial tariffs and the flexibilities provided to developing countries in the July 2004 framework agreement should never be linked.
But the chair of the negotiations, Ambassador Don Stephenson, turned his back to these two principles by linking the formula and flexibilities in his revised draft text.
He told reporters that by clubbing the formula with flexibilities for developing countries, he has merely followed the demands by a large majority of members. "I have included all their proposals and they will have to negotiate to get an outcome," he said.
In the 63-page document circulated among members, Stephenson suggested a coefficient between seven and nine for industrialised countries compared with the eight-nine in his previous draft issued in February.
India has all along demanded that industrialised countries must accept a coefficient of five. This has been opposed by the United States.
More importantly, he introduced major changes in the range of coefficients to be used in the Swiss formula for developing countries. He suggested three ranges such as 19-21, 21-23 and 23-26 as compared with the 19-23 in the previous draft.
The chair then clubbed these three ranges in coefficients for developing countries along with three different sets of flexibilities.
He suggested that the developing countries which are prepared to cut tariffs by using a coefficient between 19 and 21 will be eligible for flexibilities up to 12-14 per cent of tariff lines that will be subjected to half formula cut "and that these tariff lines do not exceed 12-19 per cent of the total value of industrial imports".
The second option open to the developing countries using a coefficient between 19 and 21 is the flexibility to exempt 6-7 per cent tariff lines from the formula cut provided their total trade value does not exceed 6-9 per cent of total industrial imports.
If developing countries choose a coefficient between 21 and 23, they will be entitled to either cut (10) of tariff lines at half the formula cut with total value of imports not exceeding (10) of the total value of industrial imports.
The second option for developing countries using a coefficient between 21 and 23 will be the flexibility to exempt 5 per cent of industrial tariff lines from any tariff cut provided their total value of imports do not exceed 5 per cent.
The countries prepared to use a coefficient between 23 and 26 in the formula would have no flexibility, he suggested.
Ambassador Stephenson further expanded the range of flexibilities for South Africa by suggesting 1-6 additional percentage points along with 10 per cent tariff lines that will be subjected to half the formula cut if it uses a coefficient between 21 and 23.
He allowed "Venezuela to apply a treatment similar to that for small, vulnerable economies".
The chair also proposed 'a single list of flexibilities' for members of the MERCOSUR Customs union, which includes Brazil, Argentina, Uruguay and Paraguay.
"What the chair should have done in his first draft that was issued last year, he did it in his latest revised text by placating specific concerns of different developing countries," said a negotiator from an industrialised country.
"In the process, he has created several new problems and increased number of square brackets," he said, adding that "Ambassador Stephenson has now washed his hands off the latest text".
