What was discussed in the10thMinisterial Conference of WTOat Nairobi, Kenya in  2015?
•   At the 10th WTO Ministerial Conference in December 2015, WTO members agreed on  a number of significant issues within the Doha Development Agenda and outlined the way  forward in WTO negotiations.
•   The Nairobi ministerial declaration for the first time opened a new window of opportunity  for WTO Members to explore new approaches to advance on ongoing negotiations and  possibly consider expanding the scope of WTO rules to cover new issues.
•   To understand it better, it is important to have a look at the Doha Development Agenda .

What is Doha Development Agenda?
•   The Doha Round of world trade negotiations also known as the Doha Development Agenda  was launched in Doha, Qatar in November 2001.
•   The talks aimed at further liberalizing trade, whilst making it easier for developing countries,  particularly Least Developed Countries (LDCs), to integrate into the WTO multilateral system.
•   The Doha Round began with a ministerial level meeting in Doha, Qatar in 2001. Subsequent  ministerial meetings took place in Cancún, Mexico (2003), and Hong Kong (2005). Related  negotiations took place in Paris, France (2005), Potsdam, Germany (2007), and Geneva,  Switzerland (2004, 2006, 2008);
•   Progress in negotiations stalled after the breakdown of the July 2008 negotiations over  disagreements concerning agriculture, industrial tariffs and non tariff barriers, services, and  trade remedies.
•   The most significant differences are between developed nations led by the European Union  (EU), the United States (US), and Japan and the major developing countries led and represented mainly by India, Brazil, China, and South Africa. There is also considerable contention against and between the EU and the US over their maintenance of agricultural  subsidies seen to operate effectively as trade barriers.

The main issues at stake are:
•   Reforming agricultural subsidies
•   Ensuring that new liberalization in the global economy respects the need for sustainable  economic growth in developing countries
•   Improving developing countries’ access to global markets for their exports:

An important agreement with respect to India in WTO is the Agreement on Agriculture (AoA)
Agreement on Agriculture (AoA):
•   WTO’s agreement on agriculture was concluded in 1994, and was aimed to remove trade barriers and to promote transparent market access and integration of global markets.
•   Agreement on agriculture stands on 3 pillars viz Domestic Support, Market Access, and Export Subsidies.

Domestic Support:
It refers to subsidies such guaranteed Minimum Price or Input subsidies which are direct and  product specific.
Under this, Subsidies are categorized into 3 boxes:

Green Box:
•   Subsidies which are no or least market distorting includes measures decoupled from Output such as income support payments (decoupled income support), safety net programs, payments under environmental programs, and agricultural research and development subsidies.
•   Such as Income Support which is not product specific. Like in India farmer is supported for  specific products and separate support prices are there for rice, wheat etc. On the other hand income support is uniformly available to farmers and crop doesn’t matter.

Blue Box:
Only ‘Production limiting Subsidies’ under this are allowed. They cover payments based on acreage, yield, or number of livestock in a base year.

Amber Box:
•   Those subsidies which are trade distorting and need to be curbed.
•   The Amber Box contains category of domestic support that is scheduled for reduction based  on a formula called the “Aggregate Measure of Support” (AMS).
•   The AMS is the amount of money spent by governments on agricultural production, except  for those contained in the Blue Box Green Box and ‘de minimis’.

De minimis provision:
•   Under this provision developed countries are allowed to maintain trade distorting subsidies or ‘Amber box’ Subsidies to level of 5% of total value of agricultural output.
•   For developing countries this figure was 10%.
•   So far India’s subsidies are below this limit, but it is growing consistently.
•   This is because MSP are always revised upward whereas Market Prices have fluctuating trends.
•   By this analogy India’s amber box subsidies are likely to cross 10% level allowed by de Minimis provision.

Market Access:
•   The market access requires that tariffs fixed (like custom duties) by individual countries be cut progressively to allow free trade.
•   It also required countries to remove non-tariff barriers and convert them to Tariff duties

Export Subsidy:
•   These can be in form of subsidy on inputs of agriculture, making export cheaper or can be  other incentives for exports such as import duty remission etc.
•   These can result in dumping of highly subsidized (and cheap) products in other country.
•   This can damage domestic agriculture sector of other country.
•   With regard to Export Subsidy, we have a mechanism known as Special Safeguard Mechanism.

Special Safeguard Mechanism:
A Special Safeguard Mechanism (SSM) would allow developing countries to impose additional (temporary) safeguard duties in the event of an abnormal surge in imports or the entry of unusually cheap imports.

India U.S Peace Clause:
•   India and the US reached an understanding on working out a “permanent solution” to the  issue of public stockholding for food security purposes at the World Trade Organisation (WTO).
•   The deal is seen as a breakthrough, ending the impasse that had stalled the implementation  of a landmark Trade Facilitation Agreement (TFA) hammered out at the WTO’s ministerial conference in Bali.

What is this Peace Clause all about?
•   It allows countries such as India to continue to freely procure and stock grains for the public  distribution system even if subsidies resulting from these breach limits under the WTO’s Agreement on Agriculture (AoA).
•   The original peace clause proposed at the Bali ministerial conference provided only a four year reprieve, during which no country would be penalised for any excessive expenditures on  food security programmes.
•   The India US agreement  which has to be endorsed by the WTO’s general council  replaces  this temporary peace clause with an open ended one until a “permanent solution” to the  issue of farm subsidies linked to national food security is arrived at.

How was India able to achieve this breakthrough?
India had blocked the adoption of a TFA that commits WTO membercountries to simplify and  standardize their Customs procedures for expediting clearance of goods at ports/border posts.

Trade Facilitation Agreement (TFA):
•   In December 2013, WTO members concluded negotiations on a Trade Facilitation Agreement  at the Bali Ministerial Conference, as part of a wider “Bali Package”
•   The purpose of the new WTO Trade Facilitation Agreement is to expedite the movement, release and clearance of goods, including goods in transit.
•   Trade Facilitation Agreement (TFA) aims to harmonize various non tariff barriers like custom procedures or administrative hurdles in the developing & least developed countries with current practices in developed countries.India became the 76th member to ratify the trade facilitation agreement (TFA) of the World Trade Organization and the agreement came into force in 2016.

What does the agreement include?
•   Lowering import tariffs and agricultural subsidies : It will make it easier for developing countries to trade with the developed world n global markets.
•   Abolish hard mport quotas  Developed countries would abolish hard mport quotas on agricultural products from the developing world and instead would only be allowed to charge tariffs on amount of agricultural imports exceeding specific limits.
•   Reduction in red tape at international borders: It aims to reduce red – tapism to facilitate trade by reforming customs bureaucracies and formalities
•   India clubbed the inking of this pact with working out a “permanent solution” to address its  concerns over food security.
•   This stance came under criticism, especially from industrialized countries who claimed that it  had left India isolated at the WTO.
•   But with the US now agreeing to an indefinite peace clause, India’s position has seemingly  been vindicated.

Why is a permanent solution important for India and what are the issues India is facing?
Problem in calculating the subsidies:
•   One reason is the way subsidies are calculated under the AoA.
•   A farmer producing, say, wheat is considered receiving a subsidy if the procurement price paid to him is higher than a world “reference” price, which is, however, taken at the levels prevailing during 1986-88.
•   Global wheat prices averaged below $ 125 a tonne then, as against $ 240-250 now. This  obviously exaggerates the extent of any subsidy.
•   India wants the subsidy computation methodology to reflect current international prices. It  will, then, have more flexibility in fixing minimum support prices (MSP), which have already crossed $ 235 per tonne in wheat.

Problem in public stockholding norms:
•   Secondly, the AoA rules on public stockholding are vague and general.
•   While direct provision of food to vulnerable consumers at subsidised prices is permitted,  such programmes are not to have “the effect of providing price support to producers”.
•   At the same time, there is specific exemption with regard to supporting “low-income or  Resource -poor producers”.
•   According to India, over 90 per cent of its farmers fall under this category and hence the subsidies incurred its food security programmes would be exempt from any reduction commitments under AoA.

Why is US having a problem with India’s stockholding program?
•   In its most recent filing before WTO, India said its total domestic support for agriculture  amounted to $ 56.1 billion in 2010-11, of which $ 13.8 billion was on public stockholding for  food security purposes.
•   The US may not mind India’s procuring and sto cking food grains, so long as these do not end up distorting global trade.
•   In the last two years, India has exported over 12 million tonnes of wheat worth $ 3.5 billion   all of this from its public stocks.
•   During the upcoming negotiations, US could insist that India refrain from exporting grain  procured ostensibly for domestic food security purposes.

Nairobi Package:
At the end of the five-day meeting, ministers adopted the “Nairobi Package”, including six  ministerial decisions on agriculture, cotton and issues of particular interest to least-developed  countries (LDCs).

Agriculture
•   On export competition, developed countries committed to remove export subsidies  immediately, except for a handful of agriculture products, which were given extra but limited  time.
•   Developing countries will do so by 2018, although net food-importing develo ping countries will have more time.
•   The decision also contains new rules on export financing support, international food aid and  exporting state-trading enterprises.
•   A ministerial decision on public stockholding for food security commits WTO members to en gage constructively in finding a permanent solution to the issue of countries stockpiling staple food crops for food security purposes.
•   The Bali ministerial decision of 2013 set a deadline of the 11th Ministerial Conference in  2017 for resolving this matter. Until a permanent solution is approved, food stockpiling at  administered prices will continue to be protected from legal action by WTO members as long  as certain conditions are met.
•   Ministers decided that negotiations to establish a special safeguard mechanism -which would allow developing countries to raise tariffs temporarily to deal with import surges or price falls - will take place in dedicated sessions of the Committee on Agriculture and  progress in these negotiations will be regularly reviewed by the General Council

Cotton
•   Ministers stressed the vital importance of cotton to LDCs (Least Developed Countries).
•   Their decision mandates developed countries to prohibit cotton export subsidies immediately while developing countries are required to do so no later than 1 January 2017.
•   It also includes a commitment by developed countries – and those developing countries declaring they are able to do so –to grant dutyfree and quota-free market access to cotton  exports from LDCs from 1 January 2016, to the extent provided for in their respective preferential trade arrangements.

LDC issues
•   Ministers built on the 2013 Bali Ministerial Decision on preferential rules of origin for LDCs,  which set out, for the first time, guidelines to help make it easier for LDC exports to qualify  for preferential market access.
•   The latest decision provides more detailed directions on issues such as methods for  determining when a product qualifies as “made in an LDC”.
•   Ministers also extended a current waiver under which WTO members may grant preferential  treatment to LDC services.
•   The waiver, adopted in December 2011, runs 15 years.
•   Ministers extended it an additional four years until 31 December 2030.
•   WTO members also agreed to continue negotiations on a longstanding proposal to shield  Trade-distorting public stockholding programmes for food security in developing countries  from legal challenge and on a proposal to allow developing countries to temporarily raise their tariffs to deal with import surges or price falls (the so - called "special safeguard  mechanism").

Other decisions
•    Ministers took three decisions regarding the regular work of WTO committees.
•    On small economies, they reaffirmed their commitment to the work programme.
•    They extended a current moratorium on so-called non-violation and situation complaints in  intellectual property.
•    On e-commerce, ministers extended a moratorium on imposing customs duties on electronic  transmission.

Landmark information technology deal
•   WTO members representing major exporters of IT products concluded a landmark deal to  eliminate tariffs on 201 information technology products valued at over U$ 1.3 trillion per year.
•   DG Azevêdo called it the “first major tariff - cutting deal at the WTO since 1996”

Negotiations on the expanded Information Technology
Agreement was reached by 53 WTO members but all members will benefit from duty - free market access to the markets of members eliminating tariffs on these products. Under the agreement, approximately 65 per cent of tariff lines will be fully eliminated by 1 July 2016 and by 2019 almost all of the relevant products will be duty free.

Finally, a declaration was signed by all Ministers:
•   As part of the declaration, the Doha Development Agenda was not reconfirmed as such due  to differences among WTO members regarding the value of the previously made attempts to  reach consensus.
•   While WTO members expressed their strong interest to advance negotiations on remaining  Doha issues, some of them also supported the adoption of new approaches to advance on  these issues.
•   The declaration also recognizes that some members wish to open negotiations on new issues in the WTO.

Important discussion of the WTO’s 11thMinisterial Conference (10-13thDecember,2017):
•   The World Trade Organization’s 11th Ministerial Conference (MC) held at Buenos Aires between 10 - 13 of December, ended without a Ministerial Declaration.
•   Members failed to reach consensus on already existing major issues like public stockholding of food items and new issues like ecommerce.
•   This is not the first time that an MC of the WTO ending without signing a Ministerial Declaration. There were not declarations at the Seattle (1999), Cancun (2003) and Geneva  (2009) Ministerial Conferences.
•    Failure at Buenos Aires comes out with a lot of implications for future trade engagements.

Following are the main facts related to the MC:
? The MC ended without progress on substantive issues

? The main issue of public stockholding of food grains.
•    There was a strong positive expectation that members will come out with a final decision on  public stockholding of food grains.
•    The issue is that in the food subsidy for public stockholding of food grains is given, such  subsidies should be considered as permissible subsidy.
•    India, China and around 100 other developing countries demanded such a treatment.
•    A strong discussion on this issue was held at Bali MC and members agreed to reach a final  solution at this MC.
•   But at Buenos Aires, the US refused to sanction such a subsidy without stringentconditions.
•   The issue was a prime one for developing countries including India. Hence the developing
countries retaliated by opposing the demand of the US and other developed countries’ demand of making discussion on new issues like ecommerce.

?  No to new issues
•    In the context of the lack of progress on already existing issues, developing countries  opposed to make discussions on new issues like ecommerce
•    New issues such as e-commerce, investment facilitation and the package for Small and  Medium Enterprises etc.., were not taken for discussion.
•    The new issues are the pets of the developed world and their allied developing country  trade partners These issues will broaden the trade agenda.

? US questioning the centrality of the development agenda within WTO
•   The WTO has given special consideration to the issues of the developing countries  historically. But at the 11th MC, the US questioned centrality of development in WTO  negotiations.
•   The US  here tried to separate trade from development and objected to mention centrality  for development at the preparation of the declaration The US stand will adversely affect  the development interest of the developing world. India opposed Buenos Aires Declaration on Women and Trade:
•   Buenos Aires Declaration on Women and Trade is non - binding declaration that sought  women’s economic empowerment by speedily removing barriers to their participation in trade.
•   India voted against the declaration What was the declaration all about?
•  The declaration provides framework for members of trade body to adopt “gender-responsive” trade policies.
•   Under it, WTO will further identify of barriers that limit women’s participation in trade, financial inclusion as well as access to trade financing.
•   It also calls for enhancement of women entrepreneurs’ participation in public procurement markets, and the inclusion of women led businesses, in particular MSMEs, in value chains.
•   The declaration will also lead to inclusion of ‘gender equality’in services trade negotiations agenda under Domestic Regulation discipline (one of major areas of services negotiations  under GATS).
•   Moreover, actions outlined in Declaration will provide more and better paid jobs for women.

Why has India opposed it?
•   India held that it strongly supports gender equality and is very much in favour of promoting  gender issues but it cannot concur with view that gender is trade-related issue .
•   WTO is purely trade--related body and not a forum to discuss gender, so gender-related discussions should take place at appropriate fora.
•   It also held that developed countries have high standard in gender-related policies as  compared to developing or least developed countries (LDC).
•   Hence the proposition to link gender and trade agreed then developed nations will curb  exports from developing world using ‘gender’ issues as non- trade barrier.Positive Outcomes of the Ministerial Conference:
•   On the positive side, the members decided to secure a deal on fisheries subsidies by the end of 2019. Discussions will continue in the next wo years regarding this. Members also pledged to improve the reporting of existing fisheries subsidy programmes.
•   In addition, members took several decisions, including extending the practice of not imposing customs duties on electronic transmissions for another two years. Besides the members also decided to continue negotiations in all areas including the new issues.