India and WTO

India and World Trade Organization

Location: Centre William Rappard Geneva, Switzerlan Established: 1 January 1995 Created by: Uruguay Round negotiations (1986-94) Membership: 153 countries of which 117 are developing countries on 23 July 2008 Budget: 200 million ($180 million, 130 million) Secretariat staff: 700 Head: Pascal Lamy (Director-General) Official languages: English, French and Spanish. Website: www.wto.int

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1.India and World Trade Organization

India is one of the founding members of WTO along with 123 other countries. India's participation in an increasingly rule based system in governance of International trade, would ultimately lead to better prosperity for the nation. Various trade disputes of India with other nations have been settled through WTO. India has also played an important part in the effective formulation of major trade policies. By being a member of WTO several countries are now trading with India, thus giving a boost to production, employment, standard of living and an opportunity to maximize the use of the world resources. The World Trade Organization came into existence on January 1st, 1995. Government had concluded the Uruguay Round Negotiations on 15th December 1993and Minister had given their political backing to the result by singing the Final Act at the meeting at Marrakesh, morocco in April 1994. The Marrakesh Declaration of April 1994, affirmed that the result of the Uruguay Round would strengthen the world economy and lead to more trade, investment, employment, and income growth throughout the world. The WTO is the embodiment of the Uruguay Round result and the successor to General Agreement on Trade and Tariffs (GATT).

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2.Introduction to General Agreement on Trade and Tariffs (GATT).

In 1948, a meeting took place in Bretton Woods, New Hampshire: the International Monetary Conference. There, negotiators agreed to create the International Monetary Fund and the World Bank. But they could not agree on an organization to deal with international trade. 3 years later, in 1947, 23 nations approved the General Agreement on Tariffs and Trade, or GATT. It was meant to be temporary. Trade negotiations under GATT were carried out in a series of talks called rounds. From GATT to WTO Dates 1947 1949 1950-51 1955-56 1961-62 1963-67 1973-79 1986-94 Name(Round) Geneva Round Annecy Round Torquay Round Geneva Round Dillon Round Kennedy Round Tokyo Round Uruguay Round Outcome 45,000 tariff concessions representing half of world trade. Modest tariff reductions. 25% tariff reductions in relation to 1948 level Modest tariff reductions. Modest tariff reductions. Average tariff reductions of 35% of industrial production, only modest reduction for agriculture product, anti- dumping codes. Average tariff reductions 34% of industrial production. Nontariff trade barrier code. Tariff, non-tariff measures, rules, service, intellectual property, disputes settlement , creation of WTO ,etc.

Objectives:
The primary objective of GATT was to expand international trade by liberalising trade to bring economic prosperity. GATT mentions the fallowing important objectives 1. Raising standards of living 2. Ensuring full employment a large and steadily growing volume of real income and effective demand 3. Developing the full use of the resources of the world 4. Expanding the production and exchange of goods.

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Basic Principle:
1) Follow the Most Favoured Nation (MFN) clause. 2) Carry on trade in a non discriminatory way. 3) Grant protection to domestic industries. 4) Condemn the use of quantitative restrictions or quotas. 5) Liberalise tariff and non-tariff measures through multilateral negotiations

Uruguay Round:
Uruguay Round (UR) is the name by which the 8th and the latest round of Multilateral Trade Negotiations (MTNs) held under the auspices of the GATT popularly known in Punta Del Este in Uruguay launched in September 1986. The main issues in this round discussed were of Agricultural Subsidies, Multi Fibre Agreement (MFA), Trade in Services, Anti Dumping etc. These discussions were resolved by the then Director General of GATT, Arthur Dunkel. Who came up or Draft of the Uruguay Round consisted of 28 agreements which spelt out the results of Multilateral Trade Negotiations (MTN). Some of the main agreements of the Uruguay Round were as follows: 1)Anti-Dumping Code: Dumping is to be condemned if it causes or threatens material injuries to an established domestic industry. A committee on anti-dumping practices should look into such matters related to dumping. 2)Trade Related Investment Measures (TRIMs): It Refers to certain conditions or restrictions imposed by a Government in respect of foreign investment in the country. TRIM is widely employed by developing countries. The agreement on TRIMs provides that no contracting party shall apply any TRIM which is inconsistent with GATT articles. An illustrative list identifies the fallowing TRIMS as inconsistent:i.Local content requirement. ii. Trade balancing requirement iii.Trade and foreign exchange balancing requirements. iv.Domestic sales requirements.

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1) Trade related aspects of Intellectual Property Rights (TRIPs) One of the most controversial outcomes of Uruguay Round is the agreement on Trade Related aspects of Intellectual Property Rights (TRIPs) including Trade in counterfeit Goods. According to GATT Intellectual Property Rights are the rights given to persons over the creations of their minds. They usually give the creator an exclusive right over the use of individuals creation for a certain period of time. 2)Trade in services Bank, Insurance, Transport and Communication, etc. are trade related services. The draft agreement proposed that all restrictions on such services should be waived. Conclusion: Following the Uruguay Round (UR) Agreement GATT was converted from a provisional agreement into a formal international organisation known as World Trade Organisation (WTO). The organisation began its function from 1st Jan. 1995. It serves as a single institutional framework directed by a Ministerial Conference once every two years and its regular business is overseen by a general council. The WTO secretariat is based in Geneva, Switzerland. The membership of the WTO increased from 128 in July 1995 to 150 countries by Jan. 1st 2010. The WTO members now accounts for over 97 percent of the international trade.

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3.Introduction toWTO:
The World Trade Organization is an international organization which was created for the liberalization of international trade. The World Trade Organization came into existence on January 1st, 1995 and it is the successor to General Agreement on Trade and Tariffs (GATT). The World trade organization deals with the rules of trade between nations at a global level. WTO is responsible for implementing new trade agreements. All the member countries of WTO have to follow the trade agreement as decided by the WTO. In April of 1994, most of those 123 nations signed an agreement. India to have signed this agreement at the time of formation of W.T.O. It replaced GATT with the World Trade Organization. The WTO has 153 members, representing more than 97% of total world trade and 30 observers, most seeking membership. The WTO is governed by a ministerial conference, meeting every two years; a general council, which implements the conference's policy decisions and is responsible for day-to-day administration; and a director-general, who is appointed by the ministerial conference. The WTO's headquarters is at the Centre William Rappard, Geneva, Switzerland. The WTO is run by its member governments. All major decisions are made by the membership as a whole, either by ministers (who meet at least once every two years) or by their ambassadors or delegates (who meet regularly in Geneva). Decisions are normally taken by consensus. In this respect, the WTO is different from some other international organizations such as the World Bank and International Monetary Fund. In the WTO, power is not delegated to a board of directors or the organizations head. When WTO rules impose disciplines on countries policies that is the outcome of negotiations among WTO members. The rules are enforced by the members themselves under agreed procedures that they negotiated, including the possibility of trade sanctions. But those sanctions are imposed by member countries, and authorized by the membership as a whole. This is quite different from other agencies whose bureaucracies can, for example, influence a countrys policy by threatening to withhold credit. Reaching decisions by consensus among some 150 members can be difficult. Its main advantage is that decisions made this way are more acceptable to all members. And despite the difficulty, some remarkable agreements have been reached. Nevertheless, proposals for the creation of a smaller executive body perhaps like a board of directors each representing different groups of countries are heard periodically. But for now, the WTO is a member-driven, consensus-based organization. The WTO's founding and guiding principles remain the pursuit of open borders, the guarantee of most-favoured-nation principle and non-discriminatory treatment by and among members, and a commitment to transparency in the conduct of its activities. The opening of national markets to international trade, with justifiable exceptions or with adequate flexibilities, will encourage and contribute to sustainable development, raise people's welfare, reduce poverty,

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and foster peace and stability. At the same time, such market opening must be accompanied by sound domestic and international policies that contribute to economic growth and development according to each member's needs and aspiration. The organization is currently endeavoring to persist with a trade negotiation called the Doha Development Agenda (or Doha Round), which was launched in 2001 to enhance equitable participation of poorer countries which represent a majority of the world's population. However, the negotiation has been dogged by "disagreement between exporters of agricultural bulk commodities and countries with large numbers of subsistence farmers on the precise terms of a 'special safeguard measure' to protect farmers from surges in imports. At this time, the future of the Doha Round is uncertain."

Function of WTO:
1. Negotiating the reduction or elimination of obstacles to trade (import tariffs, other barriers to trade) and agreeing on rules governing the conduct of international trade (e.g. antidumping, subsidies, product standards, etc.) 2. Administering and monitoring the application of the WTO's agreed rules for trade in goods, trade in services, and trade-related intellectual property rights 3. Monitoring and reviewing the trade policies of the members, as well as ensuring transparency of regional and bilateral trade agreements 4. Settling disputes among the members regarding the interpretation and application of the agreements 5. Building capacity of developing country government officials in international trade matters 6. Assisting the process of accession of some 30 countries who are not yet members of the organization 7. Conducting economic research and collecting and disseminating trade data in support of the WTO's other main activities 8. Explaining to and educating the public about the WTO, its mission and its activities.

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Benefits of WTO:
World Trade Organization helps member states in various ways and this enables them to reap benefits such as: 1. Helps promote peace within nations: Peace is partly an outcome of two of the most fundamental principle of the trading system; helping trade flow smoothly and providing countries with a constructive and fair outlet for dealing with disputes over trade issues. Peace creates international confidence and cooperation that the WTO creates and reinforces. Around 300 disputes have been brought to the WTO since it was set up in 1995. 2. Disputes are handled constructively: As trade expands in volume, in the numbers of products traded and in the number of countries and company trading, there is a greater chance that disputes will arise. WTO helps resolve these disputes peacefully and constructively. If this could be left to the member states, the dispute may lead to serious conflict, but lot of trade tension is reduced by organizations such as WTO. 3. Rules make life easier for all: WTO system is based on rules rather than power and this makes life easier for all trading nations. WTO reduces some inequalities giving smaller countries more voice, and at the same time freeing the major powers from the complexity of having to negotiate trade agreements with each of the member states. 4. Free trade cuts the cost of living: Protectionism is expensive, it raises prices, and WTO lowers trade barriers through negotiation and applies the principle of non-discrimination. The result is reduced costs of production (because imports used in production are cheaper) and reduced prices of finished goods and services, and ultimately a lower cost of living. 5. It provides more choice of products and qualities: It gives consumer more choice and a broader range of qualities to choose from.

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6. Trade raises income: Through WTO trade barriers are lowered and this increases imports and exports thus earning the country foreign exchange thus raising the country's income. 7. Trade stimulates economic growth: With upward trend economic growth, jobs can be created and this can be enhanced by WTO through careful policy making and powers of freer trade. 8. Basic principles make life more efficient: The basic principles make the system economically more efficient and they cut costs. Many benefits of the trading system are as a result of essential principle at the heart of the WTO system and they make life simpler for the enterprises directly involved in international trade and for the producers of goods/services. Such principles include; nondiscrimination, transparency, increased certainty about trading conditions etc. together they make trading simpler, cutting company costs and increasing confidence in the future and this in turn means more job opportunities and better goods and services for consumers. 9. Governments are shielded from lobbying: WTO system shields the government from narrow interest. Government is better placed to defend themselves against lobbying from narrow interest groups by focusing on trade-offs that are made in the interests of everyone in the economy. 10. The system encourages good governance: The WTO system encourages good government. The WTO rules discourage a range of unwise policies and the commitment made to liberalize a sector of trade becomes difficult to reverse. These rules reduce opportunities for corruption.

Criticisms of WTO:
1. WTO has increasing inequality: Free trade is not working for the majority of the world. During a most recent period of rapid growth in global trade and investment--1960 to 1998--inequality worsened both internationally and within countries. The UN Development Program reports that the richest 20 percent of the world's population consume 86 percent of the world's resources while the poorest 80 percent consume just
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14 percent. WTO rules have hastened these trends by opening up countries to foreign investment and thereby making it easier for production to go where the labor is cheapest and most easily exploited and environmental costs are low. This pulls down wages and environmental standards in developed countries that have to compete globally. 2. WTO has liberal the policy related to health: For the past nine years, the European Union has banned beef raised with artificial growth hormones. The WTO recently ruled that this public health law is a barrier to trade and should be abolished. The EU has to rollback its ban or pay stiff penalties.\ 3. Negotiation and decision making in the WTO are dominated by the developed countries. 4. Because of the dependence of developing country on the developed ones, the developed countries are able to resort to arm-twisting tactics. 5. The WTO has not been successful in imposing the organizations disciplines on the developed countries 6. Many of the policy liberalizations are done without considering the vulnerability of the developing countries and the possible adverse effect on them.

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Structure of the WTO :

Highest authority: the Ministerial Conference: So, the WTO belongs to its members. The countries make their decisions through various councils and committees, whose membership consists of all WTO members. Topmost is the ministerial conference which has to meet at least once every two years. The Ministerial Conference can take decisions on all matters under any of the multilateral trade agreements.

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Second level: General Council in three guises: Day-to-day work in between the ministerial conferences is handled by three bodies: 1. The General Council: WTOs highest-level decision-making body in Geneva, meeting regularly to carry out the functions of the WTO. It has representatives (usually ambassadors or equivalent) from all member governments and has the authority to act on behalf of the ministerial conference which only meets about every two years. The council acts on behalf on the Ministerial Council on all of the WTO affairs. The current chairman is Amb. Eirik Glenne (Norway). 2. The Dispute Settlement Body: It is made up of all member governments, usually represented by ambassadors or equivalent. The current chairperson is H.E. Mr. Muhamad Noor Yacob (Malaysia). 3. The Trade Policy Review Body: The WTO General Council meets as the Trade Policy Review Body to undertake trade policy reviews of Members under the TRPM. The TPRB is thus open to all WTO Members. The current chairperson is H.E. Ms. Claudia Uribe (Colombia). All three are in fact the same - the Agreement Establishing the WTO states they are all the General Council, although they meet under different terms of reference. Again, all three consist of all WTO members. They report to the Ministerial Conference. The General Council acts on behalf of the Ministerial Conference on all WTO affairs. It meets as the Dispute Settlement Body and the Trade Policy Review Body to oversee procedures for settling disputes between members and to analyze members trade policies. Third level: councils for each broad area of trade, and more: Three more councils, each handling a different broad area of trade, report to the General Council: 1. The Council for Trade in Goods (Goods Council) There are 11 committees under the jurisdiction of the Goods Council each with a specific task. All members of the WTO participate in the committees. The Textiles Monitoring Body is separate from the other committees but still under the jurisdiction of Goods Council. The body has its own chairman and only 10 members. The body also has several groups relating to textiles. The current chairperson is Amb. Yonov Frederick Agah (Nigeria).

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2. The Council for Trade in Services (Services Council) Information on intellectual property in the WTO, news and official records of the activities of the TRIPS Council, and details of the WTOs work with other international organizations in the field. 3. The Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS Council) The Council for Trade in Services operates under the guidance of the General Council and is responsible for overseeing the functioning of the General Agreement on Trade in Services (GATS). It is open to all WTO members, and can create subsidiary bodies as required. As their names indicate, the three are responsible for the workings of the WTO agreements dealing with their respective areas of trade. Again they consist of all WTO members. They cover issues such as trade and development, the environment, regional trading arrangements, and administrative issues. The Singapore Ministerial Conference in December1996 decided to create new working groups to look at investment and competition policy, transparency n government procurement, and trade facilitation. Two more subsidiary bodies dealing with the plurilateral agreements (which are not signed by all WTO members) keep the General Council informed of their activities regularly. Fourth level: down to the nitty-gritty: Each of the higher level councils has subsidiary bodies this are as follows: 1. The Goods Council - subsidiary under the Council for Trade in Goods. It has committees consisting of all member countries, dealing with specific subjects such as agriculture, market access, subsidies, anti-dumping measures and so on. Committees include the following:
y y y y

Information Technology Agreement (ITA) Committee State Trading Enterprises Textiles Monitoring Body - Consists of a chairman and 10 members acting under it. Groups dealing with notifications - process by which governments inform the WTO about new policies and measures in their countries.

2. 3.

The Services Counci l - subsidiary under the Council for Trade in Services which deals with financial services, domestic regulations and other specific commitments. Dispute Settlement panels and Appellate Body - subsidiary under the Dispute Settlement Body to resolve disputes and the Appellate Body to deal with appeals.

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Other committees y Committees on  Trade and Environment  Trade and Development (Subcommittee on Least-Developed Countries)  Regional Trade Agreements  Balance of Payments Restrictions  Budget, Finance and Administration

Basic Principal of WTO:

The WTO agreement are lengthy and complex as they are legal texts covering a wide range of activities there are 5 main basic principle and this principle are foundation of WTO. 1. Non-Discrimination.: It has two major components: the most favoured nation (MFN) rule, and the national treatment policy. Both are embedded in the main WTO rules on goods, services, and intellectual property, but their precise scope and nature differ across these areas. The MFN rule requires that a WTO member must apply the same conditions on all trade with other WTO members, i.e. a WTO member has to grant the most favorable conditions under which it allows trade in a certain product type to all other WTO members. "Grant someone a special favour and you have to do the same for all other WTO members."National treatment means that imported goods should be treated no less favorably than domestically produced goods (at least after the foreign goods have entered the market) and was introduced to tackle non-tariff barriers to trade (e.g. technical standards, security standards et al. discriminating against imported goods). 2. Reciprocity: It reflects both a desire to limit the scope of free-riding that may arise because of the MFN rule, and a desire to obtain better access to foreign marke e greater than the gain available from unilateral liberalization; reciprocal concessions intend ts. A related point is that for a nation to negotiate, it is necessary that the gain from doing so b to ensure that such gains will materialize. 3. Binding and enforceable commitments: The tariff commitments made by WTO members in a multilateral trade negotiation and on accession are enumerated in a schedule (list) of concessions. These schedules establish "ceiling bindings": a country can change its bindings, but only after

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negotiating with its trading partners, which could mean compensating them for loss of trade. If satisfaction is not obtained, the complaining country may invoke the WTO dispute settlement procedures. 4. Transparency: The WTO members are required to publish their trade regulations, to maintain institutions allowing for the review of administrative decisions affecting trade, to respond to requests for information by other members, and to notify changes in trade policies to the WTO. These internal transparency requirements are supplemented and facilitated by periodic country-specific reports (trade policy reviews) through the Trade Policy Review Mechanism (TPRM).The WTO system tries also to improve predictability and stability, discouraging the use of quotas and other measures used to set limits on quantities of imports. 5. Safety valves: In specific circumstances, governments are able to restrict trade. There are three types of provisions in this direction: articles allowing for the use of trade measures to attain noneconomic objectives; articles aimed at ensuring "fair competition"; and provisions permitting intervention in trade for economic reasons.Exceptions to the MFN principle also allow for preferential treatment of developing countries, regional free trade areas and customs unions.[citation needed]

Procedure of joining WTO:

The process of becoming a WTO member is unique to each applicant country, and the terms of accession are dependent upon the country's stage of economic development and current trade regime. The process takes about five years, on average, but it can last more if the country is less than fully committed to the process or if political issues interfere. As is typical of WTO procedures, an offer of accession is only given once consensus is reached among interested parties. Any state or customs territory having full autonomy in the conduct of its trade policies may join (accede to) the WTO, but WTO members must agree on the terms. Broadly speaking the application goes through four stages: First, Tell us about yourself: The government applying for membership has to describe all aspects of its trade and economic policies that have a bearing on WTO agreements. This is submitted to the WTO in
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a memorandum which is examined by the working party dealing with the countrys application. These working parties are open to all WTO members. Second, Work out with us individually what you have to offer: When the working party has made sufficient progress on principles and policies, parallel bilateral talks begin between the prospective new member and individual countries. They are bilateral because different countries have different trading interests. These talks cover tariff rates and specific market access commitments, and other policies in good sand services. The new members commitments are to apply equally to all WTO members under normal nondiscrimination rules, even though they are negotiated bilaterally. In other words, the talks determine the benefits (in the form of export opportunities and guarantees) other WTO members can expect when the new member joins. (The talks can be highly complicated. It has been said that in some cases the negotiations are almost as large as an entire round of multilateral trade negotiations.) Third, Lets draft membership terms: Once the working party has completed its examination of the applicants trade regime, and the parallel bilateral market access negotiations are complete, the working party finalizes the terms of accession. These appear in a report, a draft membership treaty (protocol of accession) and lists (schedules) of the member-to-bees commitments. Finally, The decision: The final package, consisting of the report, protocol and lists of commitments, is presented to the WTO General Council or the Ministerial Conference. If a two-thirds majority of WTO members vote in favors, the applicant is free to sign the protocol and to accede to the organization. In many cases, the countrys own parliament or legislature has to ratify the agreement before membership is complete.

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Differences Between GATT And WTO

No. GATT 1 It was origin in Bretton woods conference after the end of second world war. It was founded in 1948 with 23 members by the name of GATT [General Agreement on Tariffs and Trade]. 2 GATT was a provisional legal agreement 3 4 5 6 WTO The WTO came into existence on January 1st, 1995 with 123 members and it is the successor to GATT.

WTO is an organization with permanent agreements GATT dealt only with trade in goods WTO covers services and intellectual property rights The GATT dispute settlement was very The WTO dispute settlement system is slow. faster, more automatic GATT had only contracting parties. WTO has members While GATT was multi-lateral instrument , by the 1980s,many new agreement had been added of plurilateral, and therefore, selective in nature GATT is less powerful and less efficient, its ruling can be easily blocked. GATT system allowed existing domestic legislation to continue even if it violated a GATT agreement. WTO are almost multilateral and thus, involve commitment for entire membership. WTO is very powerful and more efficient, its very difficult to block the rulling. WTO doesnt permit this

7 8

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4.World map of WTO participation

Members Members, dualy represented with the European Communities Observer, ongoing accession Observer Non-member, negotiations pending Non-member Membership: The WTO has 153 members (76 members at its foundation and a further 74 members joined over the following years). The 25 states of the European Union are represented also as the European Communities. Some non-sovereign autonomous entities of member states are included as separate members. The latest member to join was Vietnam (although the Kingdom of Tonga was admitted on 15 December, 2005 during the ministerial conference, Tonga has yet to finalize ratification of this admittance, and is not expected to do so until July 2007). The shortest accession negotiation was that of the Kyrgyz Republic, lasting 2 years and 10 months. The longest was that of the People's Republic of China,
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lasting 15 years and 5 months. Russia, having first applied to join GATT in 1993, is still in negotiations for membership. A number of non-members have been observers (31) at the WTO and are currently negotiating their membership: Algeria, Andorra, Azerbaijan, Bahamas (process frozen in 2001), Belarus, Bhutan, Bosnia and Herzegovina, Cape Verde, Equatorial Guinea (expected to start membership negotiations in 2007 or earlier), Ethiopia, Holy See (Vatican; special exception from the rules allows it to remain observer without starting negotiations), Iran 1, Iraq, Kazakhstan, Lao People's Democratic Republic, Lebanon, Libya, Montenegro, Russian Federation, Samoa, Sao Tome and Principe, Serbia, Seychelles (negotiations frozen since 1998), Sudan, Tajikistan, Ukraine, Uzbekistan, Vanuatu (accession agreed in 2001, but not ratified by Vanuatu itself), and Yemen. Iran first applied to join the WTO in 1996, but the United States, accusing Tehran of supporting international terrorism, blocked its application 22 times. The U.S. said in March it would drop its veto on a start to Iran's accession negotiations. The U.S. has chosen not to block Iran's latest application for membership as part of a nuclear related deal. Syria first applied to join the WTO in October 2001, then again in January 2004 and September 2005. Its application for membership is currently still pending, waiting for WTO General Council approval to start negotiations The following states (15) and territories (2) so far have no official interaction with the WTO: the states of Eritrea, Somalia, Liberia, Turkmenistan, North Korea, Monaco, San Marino, East Timor, Comoros, Nauru, Tuvalu, Palau, Kiribati, Micronesia, Marshall Islands and the territories of Western Sahara, Palestine. Current Member of WTO:

No.

Country

Year of joining
8 -Sept-2000 (n) 1- Dec -96 (g) 1-Jan-95 1-Jan-95 5 -Feb-03 (n) 1 -Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95

No.

Country

Year of joining
1-Jan-95 20 December 1998 (n) 10 February 1999 (n) 31 May 1995 (g) 1 September 1995 (g) 31 May 2001 (n) 1-Jan-95 1-Jan-95 17 November 1995 (g) 31 May 1995 (g)

1 Albania 2 Angola Antigua and 3 Barbuda 4 Argentina 5 Armenia 6 Australia 7 Austria 8 Bahrain 9 Bangladesh 10 Barbados

76 Kuwait Kyrgyz 77 Republic 78 79 80 81 82 83 84 85 Latvia Lesotho Liechtenstein Lithuania Luxembourg Macao, China Madagascar Malawi

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11 12 13 14 15 16 17 18 19 20 21 22 23

Belgium Belize Benin Bolivia Botswana Brazil Brunei Darussalam Bulgaria Burkina Faso Burundi Cambodia Cameroon Canada

1-Jan-95 1-Jan-95 22 -Feb- 96 (g) 13 -Sept- 1995 (g) 31-May-95 (g) 1-Jan-95 1-Jan-95 1 December 1996(n) 3 June 1995 (g) 23 July 1995 (g) 13 October 2004 (n) 13 Dec. 1995 (g) 1-Jan-95

86 87 88 89 90 91

Malaysia Maldives Mali Malta Mauritania Mauritius

1-Jan-95 31 May 1995 (g) 31 May 1995 (g) 1-Jan-95 31 May 1995 (g) 1-Jan-95 1-Jan-95 26 July 2001 (n) 29 January 1997 (n) 1-Jan-95 26 August 1995 (g) 1-Jan-95 1-Jan-95

92 Mexico 93 Moldova 94 95 96 97 98 Mongolia Morocco Mozambique Myanmar Namibia Netherlands including Netherlands Antilles Nepal New Zealand Nicaragua Niger Nigeria Norway Oman Pakistan Panama Papua New Guinea

24 25 26 27 28 29 30 31 32 33

Central African Republic 31 May 1995 (g) Chad ) 19 October 1996 (g Chile 1-Jan-95 China 11 Dec. 2001(n) Colombia 30 April 1995 (g) Congo 27 March 1997 (g) Costa Rica 1 January 1995 Cte dIvoire 1 January 1995 Croatia 30 Nov. 2000 (n) Cuba 20 April 1995 (g) 30 July 1995 (g) 1-Jan-95 1 January 1997 (g) 1-Jan-95 31 May 1995 (g) 1-Jan-95 9 March 1995 (g) 21 January 1996 (n) 30 June 1995 (g)

99 100 101 102 103 104 105 106 107 108 109

1-Jan-95 23 April 2004 (n) 1-Jan-95 3 September 1995 (g) 1-Jan-95 1-Jan-95 1-Jan-95 9 November 2000 (n) 1-Jan-95 6 September 1997 (n) 9 June 1996 (g) 1-Jan-95 1-Jan-95 1-Jan-95 1 July 1995 (g) 1-Jan-95 13 January 1996 (g) 1-Jan-95 22 May 1996 (g)

34 Cyprus Czech 35 Republic Democratic Republic of 36 the Congo 37 Denmark 38 Djibouti 39 Dominica Dominican 40 Republic 41 Ecuador 42 Egypt

110 Paraguay 111 112 113 114

Peru Philippines Poland Portugal

115 Qatar 116 Romania 117 Rwanda

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43 El Salvador 44 Estonia European 45 Communities 46 Fiji 47 Finland Former Yugoslav Republic of 48 Macedonia 49 France 50 Gabon 51 Gambia 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 Georgia Germany Ghana Greece Grenada Guatemala Guinea Bissau Guinea Guyana Haiti Honduras Hong Kong, China Hungary Iceland India Indonesia

7 May 1995 (g) 13 Nov. 1999 (n) 1-Jan-95 14 January 1996 (g) 1-Jan-95

118 119 120 121 122

Saint Kitts and Nevis Saint Lucia Saint Vincent & the Grenadines Saudi Arabia Senegal

21 February1996 (n) 1-Jan-95 1-Jan-95 11-Dec-05 1-Jan-95

4 April 2003 (n) 1-Jan-95 1-Jan-95 23 October 1996 (g) 14 June 2000 (n) 1-Jan-95 1-Jan-95 1-Jan-95 22 Feb. 1996 (g) 21 July 1995 (g) 31 May 1995 (g) 25 October 1995 (g) 1-Jan-95 30 January 1996 (g) 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 21 April 1995 (g) 1-Jan-95 9 March 1995 (g) 1-Jan-95

123 Sierra Leone 124 Singapore Slovak 125 Republic 126 Slovenia Solomon 127 Islands 128 South Africa 129 Spain 130 Sri Lanka 131 Suriname 132 Swaziland 133 134 135 136 137 Sweden Switzerland Chinese Taipei Tanzania Thailand

23 July 1995 (g) 1-Jan-95 1-Jan-95 30 July 1995 (g) 26 July 1996 (g) 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95 1 July 1995 (g) 1 January 2002 (n) 1-Jan-95 1-Jan-95 31 May 1995 (g) 1 March 1995 (g) 29 March 1995 (g) 26 March 1995 (g) 1-Jan-95 10 April 1996 (g) 1-Jan-95 1-Jan-95 1-Jan-95 1-Jan-95

68 Ireland 69 70 71 72 Israel Italy Jamaica Japan

138 Togo Trinidad and 139 Tobago 140 Tunisia 141 Turkey 142 Uganda United Arab 143 Emirates United 144 Kingdom 145 United States 146 Uruguay 147 Venezuela

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73 Jordan 74 Kenya 75 Korea

11 April 2000 (n) 1-Jan-95 1-Jan-95

148 Viet Nam 149 Zambia 150 Zimbabwe

11-Jan-07 1-Jan-95 3 March 1995 (g)

150 governments, since January 2007, with date of membership (g = the 51 original GATT members who joined after 1 January 1995; n = new members joining the WTO through a working party negotiation)

5.India And WTO

Brief Introduction
INDIAS ROLE IN THE WTO India is a founding member of the GATT (1947), it actively participated in the Uruguay Round Negotiations, and is a founding member of the WTO. India strongly favours the multilateral approach to trade relations and grants MFN treatment to all its trading partners, including some who are not members of WTO. Within the WTO, India is committed to ensuring that the sectors in which the developing countries enjoy a comparative advantage are adequately opened up to international trade. It also has to see that the different WTO Agreements are translated into specific enforceable dispensations, in order that developing countries are facilitated in their developmental efforts. India feels that the multilateral system would itself gain if it adequately reflected these concerns of the developing countries, so as to create the necessary impetus to enable developing country members to catch up with their developed country counterparts

6.INDIAS WTO COMMITMENT

Under the Uruguay Round India has bound 67% of all its tariff lines, whereas prior to that only 6% of tariff lines were bound. The bindings range from 0 to 300% for agricultural products from 0 to 40% for other products. Under the Uruguay Round manufactured products were bound at 25% on intermediate goods and 40% on finished goods Balance of payments Under the exceptional provision of Article XVIII: B of GATT, India has some residual quantitative restrictions on import. maintained for balance-of-payments purpose. These aggregate to 2,714 tariff lines at the eight-digit level of the Indian Trade Classification. In May 1997, India presented to the WTO a plan for the elimination of these restrictions in imports, including those on consumer goods. This plan was considered at the consultations with India of the WTO Committee on Balance-of- Payments Restrictions in June-July 1997. At the request of the United States, a panel was constituted on 18 November 1997 to examine the US allegation

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that the continued maintenance of quantitative restrictions on imports by India is inconsistent with India's obligations under the WTO Agreement Agriculture: The only commitment India has undertaken under the Agreement is to bind its agricultural tariffs. This commitment has been fulfilled by India binding its tariffs for primary agricultural products at 100%, processed food products at 150% and edible oils at 300%.India's prevailing agricultural tariffs are well within the bound rates. Under the Uruguay Round, whenever we have bound tariffs on agricultural commodities at zero or very low-levels, renegotiation of tariff bindings have been sought under Article XXVIII of GATT. The Agreement on Agriculture was designed to improve world trade, raise prices of agricultural products and ensure higher standards of living for farmers. Textiles: As per the obligations under the Agreement on Textile and Clothing (ATC) to integrate this sector into GATT 1994 in stages, the Indian Government moved cotton and wool yarn, polyester staple fibre and 20 other industrial fabrics on to the list of freely importable goods in 1995. India is concerned about the fact that repeated anti-dumping investigation by certain trading partners on the same product lines, without giving full effect to the special dispensation provisions of Article 15 of the Anti-dumping Agreement has resulted in trade harassment for its exporters of textiles. Intellectual Property : India is availing itself of the transition periods due to her under Article 65 of the TRIPS Agreement to meet her obligations under the seven areas covered by the Agreement. India's achievements in this field have been in the passing of TRIPS plus legislation in the field of Copyright Law. The 1994 amendments to the Act of 1957 provides protection to all original literary, dramatic, musical and artistic works, cinematographic films and sound recordings. The most recent changes bring sectors such as satellite broadcasting, computer software and digital technology under Indian copyright protection Trades related investment measure: Substantial modifications have already been made to the foreign investment regime, increasing the number of sector where foreign investment can take place and also increasing the foreign equity limit on these investments. India has already notified the trade-

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related investment measures maintained by it in terms of Articles 2 and 5 of the TRIMs Agreement and the illustrative list annexed to the TRIMs Agreement

Anti-dumping: Anti-dumping and countervailing duties are imposed under the Customs Tariff Act 1975 and the Rules made there under. The Act and Rules are on the lines of the respective GATT Agreement on anti-dumping and countervailing duties. The time limits and the procedures prescribed under the Indian laws/GATT Agreement is strictly followed by the designated authority. With the increasing number of cases, the Government of India proposes to set up a Directorate General of Anti-dumping and Allied Duties for expeditious disposal of antidumping and countervailing duty cases Services sector: The services sector accounts for about 40% of India's GDP, 25% of employment and 30% of export earnings. Recognizing the importance of the services sector in achieving higher economic growth, the government is giving added emphasis to improving services such as telecommunications, shipping, roads, ports and air transport. The foreign direct investment regime has been liberalized to attract foreign investment in the services sector.India actively participated in the Uruguay Round services negotiations and made commitments in 33 activities as compared to an average of 23 for developing countries. India also participated in the spill- over negotiations. In basic telecommunication services, India has undertaken commitments in the areas of voice telephone service for local and long-distance (within the service area), cellular mobile services and other services such as circuit switched data transmission sources, facsimile services, private leased circuit services as per details given in the schedule of commitments. While developed countries have surplus capital to invest, most of the developing countries have surplus of skilled, semi- skilled and unskilled workers. We have a large pool of well- qualified professionals capable of providing services abroad. As developed countries have a comparative advantage in exporting capital intensive services, similarly developing countries have a comparative advantage in exporting labour intensive services involving movement of persons. In Article IV of GATS, there is a clear obligation to increase the participation of developing countries in trade in services. The Agreement also recognizes the basic asymmetry in

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the level of development of the services sector in developed and developing countries and a commitment that the developed countries will take concrete measures aimed at strengthening the domestic service sector of developing countries and providing effective market access in sectors and modes of supply of export interest to developing countries. Information Technology: India participated in the negotiations on the Agreement from the early stages and after examination of the implications of the proposed agreement and extensive discussions with trading partners joined as a participant on 1 April 1997. India is committed to phasing out the import tariffs on the products covered by the ITA as scheduled Regional trade agreements: India attaches significance to her participation in regional agreements within the framework of multilateral rules. India has been instrumental in setting up the South Asian Association for Regional Cooperation (SAARC), whose major achievement in 1995 was the conclusion of the negotiations on trade preferences within the framework of the SAARC Preferential Trading Arrangement (SAPTA). SAPTA became operational on 7 December 1995 and includes preferential tariff concessions on 226 items and product groups. A second round of SAPTA trade negotiations was launched in January 1996 to broaden tariff concessions. India granted concessions on 902 tariff lines, effective 1 March 1997

7.COMPARISON OF INDIAS FOREIGN TRADE BENEFITS

Before becoming the member of WTO: Its agreed that India was one of the founder member of WTO; it faced problems in Foreign Trade grounds. The problems that India faced before the formation of WTO were the following: (1)Absence of Anti dumping (2)No Subsidy Facilities (3)Absence of TRIMs & TRIPs (4)Lac of Market Scenario & Strategies After becoming the member of WTO: (1)Anti-Dumping: Dumping is condemned if it causes or threatens material injury to an established industry. A product is considered as dumped when its export price becomes less as compared to the normal price in the exporting country plus a reasonable amount for administrative, selling and any other costs and for profits. Anti dumping measures can be employed only if dumped
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imports are shown to cause serious damage to the domestic industry in the import industry. The measures are not allowed if the margin of dumping is de minimise. (2)Subsidies - The draft agreement defined certain specific subsidies which would be subjects to various disciplines. Certain other types of subsidies would fall under prohibited category 2)Technical barriers to trade: Technical regulation and standards along with testing and certification procedures should not create unnecessary obstacles to trade 3) Right of market: The main issue is to reduce tariff and other trade restriction in case of commodities like agricultural goods, textiles etc. 4)TRIMs (Trade related investment measures) : Widely employed by developing countries. Refers to certain conditions imposed by government inrespect of foreign investment. The agreement of TRIM provides the following inconsistent TRIMs. a) Local content requirement b) Trade balancing requirement c) Trade and foreign exchange balancing requirement. d) Domestic sales requirements. 5) TRIPs (Trade Related Aspects of Intellectual Property Rights: It is defined as information with commercial value. Intellectual Property Rights have been characterised as a composite of ideas, inventions and creative expression.

8.IMPACT OF WTO ON INDIA

1.AGRICULTURE Globalization manifesting in progressive integration of economies and societies has assumed increasing significance in the lives of common people all over the world. In the field of the trade the World Trade Organization (WTO) is the principal international institution responsible for laying down rules for the smooth conduct of trade in goods and services among nations in this globalized world. This is achieved by developing a set of rules of multilateral trading system which aims to remove, inter alia, trade barriers (tariff and non tariff) as well as reduce and eventually remove domestic support and system of export subsidies that distort

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international trade between nations. These problems of trade distortion are most conspicuous in agriculture sector. Agriculture is of special significance for developing countries particularly the extreme poor (i.e. those living on one dollar or less per day). It has been estimated that three quarters of them about 900 million people live and work in rural areas, most of them as small farmers. Table 1 shows that where as agriculture contributes 3% to the GDP and employs only 4% of the population in developed countries the corresponding figures for developing countries are 26% and 70% respectively. Table 1: Key differences between agriculture systems in developed and developing countries Parameters Nature of Agriculture System Share of GD Contribution to foreign exchange Population Engaged in agriculture Developed Countries Commercial/Export Oriented 3% 8.3% 4% Developing Countries (including least developed) Subsistence 26% 27% 27%

The agriculture was included in the multilateral trading system after the eighth (Uruguay) round of talks under GATT on demand of developing countries who had a comparative advantage in this sector and its benefits were being denied to them. This trade round stretched from 1986-1994 and concluded in establishment of WTO and inclusion among others of agriculture in the discipline of WTO. This was achieved by developing countries only after paying a heavy price in the form concessions on many fronts especially intellectual property rights and services. WTO policies impact agriculture principally through the following agreements: 1. Agreement on Agriculture (AOA) 2. Agreement on Application of Sanitary and Phytosanitary Standards (SPS)(Dealing with Health and disease related issues) 3. Agreement on Technical Barriers to Trade (TBT): (Dealing with Regulations, standards, testing and certification procedures, packaging, marking and labeling requirements, etc) 4.Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs): (Dealing with Patents and copyrights, plant breeders rights etc). Activists cry foul that Indian agriculture, already reeling under severe drought and fall in cash crop prices, will die once the import curbs are removed and free flow of food items are allowed into India.

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"There is going to be 'madness' in the agriculture sector. Farmers will be hit hard by the WTO regime. What happens to our vegetable oils, rice, rubber, coconuts and fruits, if similar items can be imported cheaply from other countries," asks K Sundaran, a social activist espousing farmers causes in South India. He says currently there is a massive distortion in the international trade in agriculture. Industrialised countries have been giving huge domestic subsidies to their agricultural sector that there is excessive production, import restrictions and dumping of agriproducts in international markets. But despite the concerns of farmers, many believe the WTO rules will not adversely affect the Indian agriculture as it is made out.Developed nations have committed to the WTO that they would reduce subsidies and tariff. Then overseas markets will be available for Indian agricultural products. 2. PHARMACEUTICALS India has one of the most efficient pharmaceutical industries in the world Pharmaceutical firms grew mainly thanks to the absence of patent protection of medical drugs in the country. For instance, Indian companies are now producing their own AIDS drugs, which are available cheaply, compared to the original products from foreign countries. But the imposition of the new WTO rules will begin to threaten India's achievements in the pharmaceutical field. The Indian Patents Act, introduced in 1970, boosted Indian pharma companies. The Act allowed them to develop and patent alternative processes for products discovered and patented elsewhere. According to the Indian Drug Manufacturers' Association, self-sufficiency in Indian pharmaceutical sector is more than 70 per cent. "Worldwide, India is a country of very low prices for high- quality medicines," points out the IDMA president Nishchal H Israni. But now the rules of the game in the pharmaceutical industry will change as India has committed to toe the WTO line on product patents. Product patent rules and Exclusive Marketing Rights (EMR) under the WTO could affect a paradigm shift in India's pharma majors. As per the EMR provision, a product for which original patent was granted prior to 1995, is not fit for an EMR in the country. This has forced nine leading domestic pharma companies to form the Indian Pharmaceutical Alliance that has demanded a more transparent WTO regime for EMR grants. How will the WTO rules affect 500,000 employees working in roughly 20,000 pharma firms in the country?

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Well, many expect a spate of mergers, acquisitions and alliances in the domestic pharmaceutical industry in the coming years, as the impact of WTO regulations kick in, Indian pharma players are learning to collaborate and consolidate to grow. If the industry is to be believed, the Matrix-Strides merger is only the beginning of the shakeout that the pharma sector is set to witness over the next few years. 3.THE SERVICE SECTOR As per the WTO rules, two obligations apply to all services. They are the Most Favoured Nation (MFN) treatment and transparency by way of publication of all laws and regulations. Which in other words means that areas like banking, insurance, investment banking, health, and many other professional services that are opened up will be bound by the WTO commitments? India will have to open up its services sector to other WTO member countries. The result many overseas service providers will enter into the services sectors in the country, thereby reducing the chances of domestic enterprises. But experts believe India need not be frightened of the WTO rules on services because the country at present has a distinct competitive advantage in many areas that include health, engineering construction, computer software and other professional services. 4 TEXTILES AND CLOTHING The WTO agreement on the textiles and clothing states that the Multi-Fibre Agreement (MFA) will eventually be eliminated. MFA at present groups the major importer countries are-- the United States, Austria, Canada, the European Community, Finland and Norway -- who apply restrictions by way of quota. Exporting countries like India are a part to the MFA. The phasing out of MFA will boost textile exports from India. It will also increase investment in textiles and joint ventures. But the risk is that as India opens up its market from next month, import of textiles and clothing will considerably increase from countries like China, the Unites States, Taiwan and Indonesia. This will force many textile manufacturers to modernise their mills and improve quality. 5 INFORMATION TECHNOLOGY Under the Information Technology Agreement signed under the WTO, Indian hardware and software companies can become major players in the value-added arena. Availability of high-skilled of IT personnel and low cost of labour and operation will allow India to compete in the international market. 6.TRIPS (TRADE RELATED INTELLECTUAL PROPERTY RIGHTS)

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TRIPS Article 27.3(b), which requires all WTO countries to provide some kind of intellectual property rights (IPR) on plant varieties, was up for review in 1999. TRIPS are a clearly anti- developing country treaty. Its provisions seriously threaten self reliance in agriculture and the livelihoods of farmers. TRIPS do not contain any elements of equity or benefit sharing. It does not allow countries to claim a share of benefits companies who breed new varieties using farmers varieties as the base since there is no provision requiring disclosure of the country of origin from where base materials have been taken. The Trade Related Aspects of Intellectual Rights (TRIPS) agreement set minimum standards for protection of IPRs, a standard that is closer to the level of protection provided in the developed world.

9.Doha Round
The Doha Development Round or Doha Development Agenda (DDA) is the current trade-negotiation round of the World Trade Organization (WTO) which commenced in November 2001. Its objective is to lower trade barriers around the world, which allows countries to increase trade globally. As of 2008, talks have stalled over a divide on major issues, such as agriculture, industrial tariffs and non-tariff barriers, services, and trade remedies.[1] The most significant differences are between developed nations led by the European Union (EU), the United States (USA), and Japan and the major developing countries led and represented mainly by China, Brazil, India, and South Africa. There is also considerable contention against and between the EU and the USA over their maintenance of agricultural subsidiesseen to operate effectively as trade barriers. The Doha Round began with a ministerial-level meeting in Doha, Qatar in 2001. Subsequent ministerial meetings took place in Cancn, Mexico (2003), and Hong Kong (2005). Related negotiations took place in Geneva, Switzerland (2004, 2006, 2008); Paris, France (2005); and Potsdam, Germany (2007). The most recent round of negotiations, 23-29 July 2008, broke down after failing to reach a compromise on agricultural import rules.After the breakdown, major negotiations were not expected to resume until 2009. Nevertheless, intense negotiations, mostly between the USA, China, and India, were held in the end of 2008 in order to agree on negotiation modalities. However, these negotiations did not result in any progress. Doha Round talks are overseen by the Trade Negotiations Committee (TNC), whose chair is the WTOs director-general, currently Pascal Lamy. The negotiations are being held in five working groups and in other existing bodies of the WTO. Selected topics under negotiation are discussed below in five groups: market access, development issues, WTO rules, trade facilitation and other issues.

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Before Doha
Before the Doha ministerial, negotiations had already been under way on trade in agriculture and trade in services. These ongoing negotiations had been required under the last round of multilateral trade negotiations (the Uruguay Round, 1986-1994). However, some countries, including the United States, wanted to expand the agriculture and services talks to allow trade-offs and thus achieve greater trade liberalization. The first WTO ministerial conference, which was held in Singapore in 1996, established permanent working groups on four issues: transparency in government procurement, trade facilitation (customs issues), trade and investment, and trade and competition. These became known as the Singapore issues. These issues were pushed at successive ministerials by the European Union, Japan and Korea, and opposed by most developing countries.[1] Since no agreement was reached, the developed nations pushed that any new trade negotiations must include these issues. The negotiations were intended to start at the ministerial conference of 1999 in Seattle, USA, and be called the Millennium Round but, due to several different events including protest activity outside the conference (the so-called "Battle of Seattle"), the negotiations were never started.Due to the failure of the Millennium Round, it was decided that negotiations would not start again until the next ministerial conference in 2001 in Doha, Qatar. According to the so-called "built-in agenda", negotiations on agriculture and trade in services started in 2000. These negotiations were later merged into the overall Doha negotiations. Just months before the Doha ministerial, the United States had been attacked by terrorists on 11 September 2001. Some government officials called for greater political cohesion and saw the trade negotiations as a means toward that end. Some officials thought that a new round of multilateral trade negotiations could help a world economy weakened by recession and terrorism-related uncertainty. According to the WTO, the year 2001 showed "...the lowest growth in output in more than two decades," and world trade contracted that year.

Doha, 2001
Began in November 2001, committing all countries to negotiations opening agricultural and manufacturing markets, as well as trade-in-services (GATS) negotiations and expanded intellectual property regulation (TRIPS). The intent of the round, according to its proponents, was to make trade rules fairer for developing countries. However, by 2008, critics were charging that the round would expand a system of trade rules that were bad for development and interfered excessively with countries' domestic "policy space".

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Importance of US presidential 'fast-track' authority The round had been planned for conclusion in December 2005 after two more ministerial conferences had produced a final draft declaration. The WTO pushed back its selfimposed deadline to slightly precede the expiration of the U.S. President's Congressional Fast Track Trade Promotion Authority. Any declaration of the WTO must be ratified by the U.S. Congress to take effect in the United States. Trade Promotion Authority prevents Congress from amending the draft. It expired on 30 June 2007, and congressional leaders decided not to renew this authority for President George W Bush.

Cancn, 2003
The 2003 Cancn talksintended to forge concrete agreement on the Doha round objectivescollapsed after four days during which the members could not agree on a framework to continue negotiations. Low key talks continued since the ministerial meeting in Doha but progress was almost non-existent.This meeting was intended to create a framework for further negotiations. Collapse of negotiations The Cancn ministerial collapsed for several reasons. First, differences over the Singapore issues seemed incapable of resolution. The EU had retreated on some of its demands, but several developing countries refused any consideration of these issues at all. Second, it was questioned whether some countries had come to Cancn with a serious intention to negotiate. In the view of some observers, a few countries showed no flexibility in their positions and only repeated their demands rather than talk about trade-offs. Third, the wide difference between developing and developed countries across virtually all topics was a major obstacle. The U.S.EU agricultural proposal and that of the G20 developing nations, for example, show strikingly different approaches to special and differential treatment. Fourth, there was some criticism of procedure. Some claimed the agenda was too complicated. Also, Cancn ministerial chairman, Mexicos Foreign Minister Luis Ernesto Derbez, was faulted for ending the meeting when he did, instead of trying to move the talks into areas where some progress could have been made. The collapse seemed like a victory for the developing countries. The failure to advance the round resulted in a serious loss of momentum and brought into question whether the 1 January 2005 deadline would be met.The North-South divide was most prominent on issues of agriculture. Developed countries farm subsidies (both the EUs Common Agricultural Policy and the U.S. government agro-subsidies) became a major sticking point. The developing countries were seen as finally having the confidence to reject a deal that they viewed as unfavorable. This is reflected by the new trade bloc of developing and industrialized nations: the G20. Since its creation, the G20 has had fluctuating membership, but is spearheaded by the G4 (the People's Republic of China, India, Brazil, and South Africa). While the G20 presumes to

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negotiate on behalf of all of the developing world, many of the poorest nations continue to have little influence over the emerging WTO proposals. Geneva, 2004 The aftermath of Cancn was one of standstill and stocktaking. Negotiations were suspended for the remainder of 2003. Starting in early 2004, U.S. Trade Representative Robert Zoellick pushed for the resumption of negotiations by offering a proposal that would focus on market access, including an elimination of agricultural export subsidies.He also said that the Singapore issues could progress by negotiating on trade facilitation, considering further action on government procurement, and possibly dropping investment and competition. This intervention was credited at the time with reviving interest in the negotiations, and negotiations resumed in March 2004. In the months leading up to the talks in Geneva, the EU accepted the elimination of agricultural export subsidies by date certain. The Singapore issues were moved off the Doha agenda. Compromise was also achieved over the negotiation of the Singapore issues as the EU and others decided. Developing countries too played an active part in negotiations this year, first by India and Brazil negotiating directly with the developed countries (as the so-called non-party of five) on agriculture, and second by working toward acceptance of trade facilitation as a subject for negotiation. With these issues pushed aside, the negotiators in Geneva were able to concentrate on moving forward with the Doha Round. After intense negotiations in late July 2004, WTO members reached what has become known as the Framework Agreement(sometimes called the July Package), which provides broad guidelines for completing the Doha round negotiations. The agreement contains a 4-page declaration, with four annexes (A-D) covering agriculture, non-agricultural market access, services, and trade facilitation, respectively. In addition, the agreement acknowledges the activities of other negotiating groups (such as those on rules, dispute settlement, and intellectual property) and exhorts them to fulfill their Doha round negotiating objectives. The agreement also abandoned the 1 January 2005 deadline for the negotiations and set December 2005 as the date for the 6th ministerial to be held in Hong Kong.

Paris, 2005
Trade negotiators wanted to make tangible progress before the December 2005 WTO meeting in Hong Kong, and held a session of negotiations in Paris in May 2005. Paris talks were hanging over a few issues: France protested moves to cut subsidies to farmers, while the U.S., Australia, the EU, Brazil and India failed to agree on issues relating to chicken, beef and rice. Most of the sticking points were small technical issues, making trade negotiators fear that agreement on large politically risky issues will be substantially harder.

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Hong Kong, 2005

The Hong Kong Convention Center, which was the site of the Sixth WTO Ministerial Conference The Sixth WTO Ministerial Conference took place in Hong Kong, 13 to 18 December, 2005. Although a flurry of negotiations took place in the fall of 2005, WTO directorgeneral Pascal Lamy announced in November 2005 tha t a comprehensive agreement on modalities would not be forthcoming in Hong Kong, and that the talks would take stock of the negotiations and would try to reach agreements in negotiating sectors where convergence was reported. Trade ministers representing most of the world's governments reached a deal that sets a deadline for eliminating subsidies of agricultural exports by 2013. The final declaration from the talks, which resolved several issues that have stood in the way of a global trade agreement, also requires industrialized countries to open their markets to goods from the world's poorest nations, a goal of the United Nations for many years. The declaration gave fresh impetus for negotiators to try to finish a comprehensive set of global free trade rules by the end of 2006. Director-general Pascal Lamy said, "I now believe it is possible, which I did not a month ago." The conference pushed back the expected completion of the round until the end of 2006.

Geneva, 2006
The July 2006 talks in Geneva failed to reach an agreement about reducing farming subsidies and lowering import taxes, and negotiations took months to resume. A successful outcome of the Doha round became increasingly unlikely, because the broad trade authority granted under the Trade Act of 2002 to U.S. president George W. Bush was due to expire in 2007. Any trade pact would then have to be approved by the U.S. Congress with the possibility of amendments, which would hinder the U.S. negotiators and decrease the willingness of other countries to participate. Hong Kong offered to mediate the collapsed trade liberalisation talks. Director-general of Trade and Industry, Raymond Young, says the territory, which hosted the last round of Doha negotiations, has a "moral high-ground" on free trade that allows it to play the role of "honest broker".[citation needed]

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Potsdam, 2007
In June 2007, negotiations within the Doha round broke down at a conference in Potsdam, as a major impasse occurred between the USA, the EU, India and Brazil. The main disagreement was over opening up agricultural and industrial markets in various countries and also how to cut rich nation farm subsidies.

Geneva, 2008
On 21 July 2008, negotiations started again at the WTO's HQ in Geneva on the Doha round but stalled after nine days of negotiations over the refusal to compromise over the special safeguard mechanism. "Developing country Members receive special and differential treatment with respect to other Members' safeguard measures, in the form of a de minimis import volume exemption. As users of safeguards, developing country Members receive special and differential treatment with respect to applying their own such measures, with regard to permitted duration of extensions, and with respect to re-application of measures. Technical Information on Safeguard Measures WTO official site Negotiations had continued since the last conference in June 2007. Directorgeneral Pascal Lamy said before the start of the conference that the odds of success were over 50%. Around 40 ministers attended the negotiations, which were only expected to last five days but instead lasted nine days. Kamal Nath, India's Commerce Minister, was absent from the first few days of the conference due to a vote of confidence being conducted in India's Parliament.On the second day of the conference, U.S. Trade Representative Susan Schwab announced that the U.S. would cap its farm subsidies at $15 billion a year, from $18.2 billion in 2006.The proposal was on the condition that countries such as Brazil and India drop their objections to various aspects of the round.The U.S. and the EU also offered an increase in the number of temporary work visas for professional workers. After one week of negotiations, many considered agreement to be 'within reach'. However, there were disagreements on issues including special protection for Chinese and Indian farmers and African and Caribbean banana imports to the EU. India and China's hard stance regarding tariffs and subsidies was severely criticized by the United States.In response, India's Commerce Minister said "I'm not risking the livelihood of millions of farmers." Collapse of negotiations The negotiations collapsed on 29 July over issues of agricultural trade between the United States, India, and China.In particular, there was insoluble disagreement between India and the United States over the special safeguard mechanism (SSM), a measure designed to protect poor farmers by allowing countries to impose a special tariff on certain agricultural goods in the event of an import surge or price fall.

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Pascal Lamy said, "Members have simply not been able to bridge their differences." He also said that out of a to-do list of 20 topics, 18 had seen positions c onverge but the gaps could not narrow on the 19th the special safeguard mechanism for developing countries. However, the United States, China and India could not agree on the Pascal Lamy threshold that would allow the mechanism to be used, with the United States arguing that the threshold had been set too low. The European Union Trade Commissioner Peter Mandelson characterized the collapse as a "collective failure". On a more optimistic note, India's Commerce Minister, Kamal Nath, said "I would only urge the director-general to treat this [failure of talks] as a pause, not a breakdown, to keep on the table what is there." Several countries blamed each other for the breakdown of the negotiations.The United States and some European Union members blamed India for the failure of the talks. India claimed that its position was supported by over 100 countries.[ Brazil, one of the founding members of the G-20, broke away from the position held by India. Then-European Commissioner for Trade Peter Mandelson said that India and China should not be blamed for the failure of the Doha round.In his view, the agriculture talks had been harmed by the five-year program of agricultural subsidies recently passed by the U.S. Congress, which he said was "one of the most reactionary farm bills in the history of the U.S.".

Current progress of Doha Round

Several countries have called for negotiations to start again. Brazil and Pascal Lamy have led this process. Luiz Incio Lula da Silva, president of Brazil, called several countries leaders to urge them to renew negotiations. Lamy visited India to discuss possible solutions to the impasse.[ A mini-ministerial meeting held in India on September 3rd and 4th pledged to complete the round by the end of 2010.The declaration at the end of the G20 summit of world leaders in London in 2009 included a pledge to complete the Doha round. Although a WTO ministerial conference scheduled in November 2009 would not be a negotiating session, there would be several opportunities over the year 2009 to discuss the progress. The WTO is involved in several events every year that provide opportunities to discuss and advance, at a conceptual level, trade negotiations. In early 2010, Brazil and Lamy have focused on the role of the United States in overcoming the deadlock. Lula has urged Barack Obama to end the trade dispute between Brazil

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and the US over cotton subsidies following his increase in tariffs on over 100 US goods.. Lamy has highlighted the difficulty of obtaining agreement from the US without the Presidential fast track authority and biennial elections. One of the consequences of the economic crisis of 2008 2009 is the desire of political leaders to shelter their constituents from the increasingly competitive market experienced during market contractions. Lamy hopes that the drop in trade of 12% in 2009, quoted as the largest annual drop since the Second World War, could be countered by successful conclusion of the Doha round.

Benefits
All countries participating in the negotiations believe that there is some economic benefit in adopting the agreement; however, there is considerable disagreement of how much benefit the agreement would actually produce. A study by the University of Michigan found that if all trade barriers in agriculture, services, and manufactures were reduced by 33% as a result of the Doha Development Agenda, there would be an increase in global welfare of $574.0 billion.A 2008 study by World Bank Lead Economist Kym Andersonfound that global income could increase by more than $3000 billion per year, $2500 billion of which would go to the developing world.Others had been predicting more modest outcomes, e.g. world net welfare gains ranging from $84 billion to $287 billion by the year 2015. Pascal Lamy has conservatively estimated that the deal with bring an increase of $130 billion. Several think tanks and public organizations assess that the conclusion of the trade round will result in a net gain . However, the restructuring and adjustment costs required to prevent the collapse of local industries, particularly in developing countries, is a global concern. For example, a late 2009 study by the Carnegie Endowment for International Peace, the United Nations Economic Commission for Africa (UNECA), the United Nations Development Programme and the Kenyan Institute for Research and Policy Analysis found that Kenya would see gains in its exports of flowers, tea, coffee and oil seeds. It would concurrently lose in the tobacco and grains markets, as well as manufacturing of textiles and footwear, machinery and equipment. The Copenhagen Consensus, which evaluates solutions for global problems regarding the cost-benefit ratio, in 2008 ranked the DDA as the second-best investment for global welfare, after the provision of vitamin supplements to the world's 140 million malnourished children.

10.CONCLUSION
The developed countries want that the underdeveloped countries observe some restrictions relating to labour employment and ecological balance. Their argument is that the underdeveloped countries use child labours or their social security measures are very poor. Further, these countries do not take measures to control pollution or to maintain ecological
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India and WTO

balance. As a result, cost of production in such countries is low. So, the developed countries should be allowed to impose tariffs or imports from underdeveloped countries until the developing countries improve the condition of labour and do not employ child labour. Thus, the developed countries tried to impose many restrictions on the production process of the underdeveloped countries. Thus, if the developing countries try to protect their interest as a group, they may stand to gain from the WTO system. If we consider both sides of a coin then we can conclude that if the developed countries liberalise their import of agricultural goods, Indias export of agricultural goods will increase. India has a comparative cost advantage in the production of agricultural commodities. Hence Indias of such commodity is expected to increase. On the other side according to the agreement of Trade Related Investment Measures (TRIMs), there should not be any discrimination between foreign and domestic investments. As a result, it will very difficult to control the restrictive activities of the following investors. This agreement will also favour investors of the developed countries.

11.BIBLIOGRAPH
1) Essential of Business Environment K.Aswathappa (2)Business Environment - Francis Cherunilam (3) www.wikipedia.org (4) www.wto.org (5)Annual Report 2007 (6)Department of Commerce, Government of Indi

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