Friday, 1 August 2014

WTO deal: India blames use of a comma for creating ambiguity - Economic Times

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NEW DELHI Under attack for its tough stand at the World Trade Organization (WTO) meeting in Geneva that led to the collapse of the talks about a global trade deal on Thursday, some officials sought to justify its position by blaming the use of a comma as giving rise to ambiguity.

This comma apparently was cause for confusion over the availability of the 'peace clause' on the issue of stockpiling for food security needs.


India wanted the agreement to unequivocally mean that the 'peace clause' was available till a permanent solution to the issue of food subsidy was found rather than a four-year relaxation.


"In December 2013, after hard negotiation we clearly got a peace clause until a permanent solution, but there were members who were mentioning that it was only for four years. We want this ambiguity to be removed," said a government official.


The 'peace clause' is an interim arrangement that says no country can take action against another for providing food subsidies beyond the WTO agreed limit till the food security issue is agreed.


"If friends don't let us find permanent solution, then the permanent peace clause will be to our safety. It will force both sides to find a solution by December 31, 2014. To us, as we have given the deadline, and to them as permanent peace clause would give us the freedom to run away," the official said.


The agreement on the peace clause reads: "Members agree to put in place an interim mechanism as set out below, and to negotiate on an agreement for a permanent solution, for the issue of public stockholding for food security purposes for adoption by the 11th ministerial conference. In the interim, until a permanent solution is found, and provided that the conditions set out below are met, members shall refrain from challenging through the WTO Dispute Settlement Mechanism..."


India interpreted this — "In the interim, until a permanent solution is found... members shall refrain from challenging"— to mean that it was an open-ended assurance.


Officials said instead of the comma after 'interim', it should have been 'or' so that there was no ambiguity.


But would that have made a difference?


If India had an open-ended assurance on the 'peace clause', it would not have shied away from the trade facilitation agreement as its interests would have been protected.


India's fear was that it would have been open to action on subsidies if a permanent solution wasn't found by the 11th ministerial due in 2017.


"Ideal language should have been, 11th ministerial, 'or' a permanent solution is found. In negotiations, we could not get through our 'or'. We left at 'until permanent solution', which is called 'creative ambiguity' in legal terms," the official added.


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