The Doha Round of multilateral trade negotiations is all but dead. Meanwhile, countries are busy signing bilateral and regional free-trade agreements - India has done so with South Korea and the Association of Southeast Asian Nations (Asean), for instance, and is negotiating one with the European Union (EU). But the granddaddies of all such deals (nominally about trade but in reality virtually all-encompassing) are those that the United States has been pushing - on the one hand with 11 countries on the Pacific Rim and on the other with the EU. The first - called the Trans-Pacific Partnership - is said to be close to conclusion, though little about the agreement is known. China, the world's largest trading nation and very much on the Pacific Rim, is not one of the negotiating parties. The Transatlantic Trade and Investment Partnership could be equally significant whenever it fructifies. And here's the thing: India is not involved in either, but will inevitably get sucked in.
Why? Because while the negotiations are nominally about trade and tariffs, they cover a gamut of issues that tighten or loosen regulations on everything from drug and other patents to environmental protection, regulation of cigarette sales to health and safety norms, the protection of agriculture and dairying to rules governing the Internet, and of course control of the activities of financial intermediaries. These subjects involve national sovereignty, privacy and other issues. But the attempt is to unify rules and regulations for all the signing parties - and national rules and laws will or may have to be rewritten if not in consonance with the new agreements. The US calls this a trade deal for the 21st century, but it is obvious that the idea is to sidestep the naysayers at Doha (read India), while China has been seen to be taking unfair advantage of the rules of the World Trade Organisation (WTO). To borrow a term from another theatre of action, these will be Coalitions of the Willing (or CoWs).
Those who recall why India walked out of the negotiations for a Comprehensive (nuclear) Test Ban Treaty in the 1990s will remember that the draft treaty sought to enforce its terms on even those countries that refused to sign on the dotted line. Something similar is on the cards here, should the two trans-ocean partnerships become reality. The signatories to the agreements will account for the bulk of world trade; and they will want to impose clauses in these agreements, which go well beyond WTO stipulations, on any country that subsequently wants to sign a trade deal. Turkey, which already has a customs union with the European Union, will lose heavily unless it joins and signs on the dotted line. Thailand too, it is said, may have to accept whatever wording is agreed on in the trans-Pacific deal. India must be careful about whatever it signs with the EU.
These are potential dangers, not established facts, flagged by the media and civil society activists. Few people other than those taking part in the negotiations are able to comment authoritatively on what is in store because the draft texts have not been made public - which is, in itself, extraordinary. Perhaps the texts will get watered down as more countries join in the negotiations (as Japan did recently, and South Korea may in the future). Perhaps the EU will prove to be a tough negotiator. Whatever the case, the immediate need is for transparency - so that the world knows what's cooking. Domestically, India may have no more than five or 10 years to complete most of its reform agenda; domestic regulations (banking, emissions control, product quality specifications, dispute resolution, pesticide use, etc) must be of high quality and effective, and producers must become efficient and competitive before India finds that a more integrated global economy leaves it little wiggle room.
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