Sunday, June 28, 2009

Could Doha be back on?

India's new government is eager to resume the Doha round of world trade talks, according to the country's new minister for commerce and industry. Anand Sharma told the Financial Times that India was keen to break the impasse in negotiations. Mr Sharma's tone marks a significant shift from his predecessor, Kamal Nath, who was known for his uncomprising stance in the Doha talks.

Many countries blamed India for the breakdown of ministerial talks a year ago intended to forge a blueprint for concluding the Doha round. The meeting ended in disarray after India and the US failed to reach a compromise over the special safeguard mechanism, designed to protect farmers in poor countries from surges of agricultural imports. Washington said imports should have to increase 40 per cent to trigger safeguard tariffs, whereas India wanted a very low 10 per cent trigger.

World trade negotiations have been the most significant driver for CAP reform for nearly two decades and a resumption of them could counter balance strengthening protectionist forces in Europe.


Julien Frisch said...

Two questions:

a) Is this a realistic perspective seeing the repeated failure of Doha over the last years?

b) In which way would this concretely influence the CAP? (A link to some background explanations would be great!)

Wyn Grant said...

a) On the first point agreement at least on the principles of a settlement was very near last year and the Indian stance was the main stumbling book.
b) There is a very extensive academic literature on this point, e.g., by Alan Swinbank and others in the Journal of Common Studies. At its simplest, international trade negotiations provide an exogenous pressure for reform that overcomes domestic resistance.

Julien Frisch said...

Thanks, especially for b).

Just read "Exploring the Determinants of CAP Reform: A Delphi Survey of Key Decision-Makers" by Cunha/Swinbank (2009) in JCMS 47 (2), which pretty much proves your point...