US drugs right waiver helps WTO talks

With the US agreeing to the demand of developing countries for waiving patent right for poor countries to manufacture life saving drugs, and a solution on agriculture negotiations in sight, Indian officials are of the opinion that the mandated negotiations under the World Trade Organisation are back on track.

"My impression is that negotiations will move quickly now if the European Union is able to finalise its common agricultural policy in the next seven days," S N Menon, additional secretary in commerce ministry, said at a workshop on non-agricultural market access organised by the Confederation of Indian Industry.

A spokesperson for the EU had last week said the WTO was preparing a draft on the modalities for agriculture negotiations, which was expected to be finalised by mid-July.

The draft paper is expected to be discussed at the next mini-ministerial in Montreal on July 28 and 29.

Once the agriculture negotiations were back on track, industrial goods would follow, Menon explained on Wednesday.

Under trade-related intellectual property rights and public health, Menon said, the US had agreed to provide a wider coverage for diseases, apart from its original proposal covering HIV, AIDS, tuberculosis and malaria.

India and other developing countries like South Africa and Brazil wanted the benefits to be extended to all diseases declared as epidemics. It seems the issue will be settled before Cancun.

Wednesday's workshop was part of the commerce ministry's initiative to consult stakeholders before finalising India's position on liberalising trade in industrial goods.

The draft modalities for negotiations circulated by the WTO have proposed elimination of tariffs in seven sectors.

The sectors covered include electronics and electrical goods, fish and fish products, footwear, leather goods, auto components, textiles, stones, gems and precious metals.

In addition, a steep tariff reduction has been proposed, with developing countries given the option to keep 5 per cent of the tariff lines, representing about 5 per cent of imports, unbound.

In responses to the tariff elimination proposal, S P Oswal, chairman and managing director of Vardhaman Spinning and General Mills, said the proposal was favourable though India should ensure that least developed countries like Bangladesh were not given too many benefits. He said the Indian textiles industry was facing competition from least developed and developing countries.

The Automobile Component Manufacturers' Association, however, said India should oppose elimination of duty in the sector.

Industry representatives also said the government should ensure that the duty on inputs for sectors covered under sectors for duty elimination or steep reduction were also reduced in proportion.