India builds support for its stand against revoking ‘developing nation’ tag at WTO

Other nations’ support to be sought against US call to revoke the tag

Published: 05th May 2019 10:19 AM  |   Last Updated: 05th May 2019 10:19 AM   |  A+A-

Express News Service

NEW DELHI: India will use the opportunity of a mini-meeting of trade ministers later this month to try and build support for its stand against revoking its ‘developing nation’ tag at the World Trade Organisation (WTO), a major demand made by the Trump Administration.

Top officials said India will try and bond with China and South Africa as well as other nations over defending their common developing nation tag at WTO, against US demands that privileges that go with the tag should go for these countries. India, jointly with China and South Africa, has already sent a letter to the WTO on this issue.

“The mini-ministerial meeting is slated for May 13-14, soon after the visit by the US Trade Representative to India and we hope to use the meet to build support for our logic that India remains a developing nation as some 21.2 per cent of our people remain poor, earning less than $2 a day,” said officials. India, China and South Africa, along with some other nations, are categorised as developing countries under WTO rules, which afford them “special and differential treatment”, enabling them to give subsidies in agriculture and set higher barriers for market entry than most developed economies.

However, the US has contended that India, along with many other countries, were no longer developing countries, and as such could not continue with many of their subsidies and tariff barriers, and the longer time periods they took to implement commitments on cutting tariffs given at the WTO. The US has also contended that India has been raising tariffs on a number of products such as cell phone parts to compel manufacturers such as Apple to shift production to India. However, this does not affect the US firms as much as it does the Chinese and the Taiwanese, from whom Apple sources its parts.

China has also opposed the US decision and stated that it is simply “the largest developing country in the world.” The US is pushing for a framework that defines nations as developed based on a criterion that takes into account their GDP as well as their share of world trade. The US contention is that China cannot ask for the developing nation tag as its per capita GDP is over $8,600 and India is disqualified as it accounts for 0.5 per cent share in world trade.

US CONTENTION

The US seeks to revoke ‘developing nation’ tag as China’s per capita GDP is over $8,600 and India accounts for 0.5 per cent share of world trade.

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