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| The battle between the US and the European Union on opening up agricultural trade was supposed to be the defining point of the next round of trade liberalisation. |
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| Instead, the two giant protagonists have joined hands in a stunning coup before the formal negotiations even begin. The deal has now galvanised into life what had been virtually deadlocked negotiations, and it has forced the other members of WTO to rethink their strategies. |
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| For, it has shifted the focus of the talks from subsidy reductions to tariff cuts, while pushing back other issues such as access to essential medicines and special and differential treatment for developing countries and their export products. |
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| What is even more striking is that it has led to regrouping of countries into distinct blocks, raising fresh hopes as also dangers. |
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| The hope is that the countries or groups will now start actually negotiating deals, rather than merely taking positions as they have been doing till now. |
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| But the danger is that the increased negotiating clout that these groups now enjoy might jeopardise the hammering out of a consensus on crucial issues, making the whole exercise meaningless. The main casualty in such an event would be the concept of multilateralism, vital to most trading countries. |
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| From the Indian point of view, or for that matter from the point of view of the developing economies, the new emergence of a new caucus of 13 countries, including some giants in agricultural trade such as China, Brazil, Argentina, South Africa and Thailand, is the best thing to have happened. |
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| For, individually, none of these countries could expect to have much of a say under the changed circumstances brought about by the US-EU deal. Together, they represent a major share in global trade as well as a vast consumption market that the developed bloc would not want to ignore. |
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| The support base of this new alliance is certain to swell. The lobbying therefore aims at pushing for drastic reduction in domestic support levels for, reduction in subsidies, sharply disciplining export credit, and special safeguards for the developing countries. |
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| On the most contentious issue of tariff cuts, this new group has suggested a hybrid tariff reduction approach, marrying the Uruguay round mechanism for some products with a formula-based approach for others. |
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| Besides, it seeks zero import duty in developed markets for tropical products and those of export interest to the developing countries. The appeal of this agenda has already split the 18-member Cairns group because it seeks to revert the focus of the talks back to subsidies in particular, and the Doha development agenda in general. |
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It is now up to WTO
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