CUTS International Global Affairs
Monthly Brief #71, February 2024
The Show Must Go On – WTO MC13 and Beyond
 
The 13th Ministerial Conference (MC13) of the World Trade Organisation (WTO) was held last week in Abu Dhabi. Despite stretching a day beyond schedule, it produced only modest outcomes, leaving most of the contentious issues undecided. MC13 has once again exposed both the traditional and emerging fault lines among world powers when it comes to the rules of (and the role of) trade in a fast-changing world.
 
At the same time, the need for closer cooperation on trade issues and harnessing the power of trade to address developmental concerns and emerging challenges such as climate change has never been greater.
 
Where do we go from here, amidst these tensions pulling in different directions?
 
The two-tier dispute settlement system remains in limbo, with the full restoration of the original appeals mechanism in the shape of a standing Appellate Body looking increasingly unlikely with each passing day.
 
Although the success of high-level inter-governmental plenaries should not be seen entirely from the lens of the number of agreements sealed, incremental progress is important. It is worrisome when legacy issues such as agricultural trade remain unresolved at the WTO even after many years, which in turn hinders progress on emerging issues. This is a vicious cycle.
 
The situation today is partly a result of overburdening the WTO with an ever-expanding agenda, often losing sight of its original moorings. Developments in the bilateral and regional trade architectures are fast outpacing the multilateral trade agenda.
 
Yet, we must recognise the enduring value of the multilateral trading system with the WTO at its core, as the pre-eminent forum for advancing cooperation on trade-related issues.
 
We must remind ourselves that the WTO itself facilitates liberalisation through FTAs, as long as they remain building blocks of multilateralism. Further, there are core issues such as subsidies which inherently have spillover effects and can only be discussed multilaterally to arrive at efficient solutions.
 
In the aftermath of every perceived failure to deliver a range of outcomes at a Ministerial, there are calls to turn the clock back and relegate the WTO’s role as the overseer of global trade. These are highly misplaced. Could WTO Members have delivered more at MC13? Definitely. But do modest outcomes at MC13 mean that the WTO is doomed to fail? History has taught us better.
 
Ministerials come and go, but the effort to continue having constructive discussions on the role of trade as a means towards global economic development should continue with fresh zeal after each Conference.
      

Pradeep S. Mehta
Editor

P.S.: The Finance Minister of Brazil, which currently holds the G20 Presidency, has proposed a drastic tax reform – a global tax on the super-rich. Will this get traction like the global minimum tax on MNCs which has already come into effect, or will it fizzle out?
 
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This is the seventy-first edition of the Monthly Brief from the Center, which carries select published news or comments on a relevant issue. There are equally important issues which may have been missed out to keep the Monthly Brief short and swiftly readable.
 
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CUTS involvement in leveraging free trade and encouraging competition noteworthy: Former RBI Governor Rangarajan
"CUTS involvement in leveraging free trade and encouraging competition within the system, contributing to the interests of the developing countries in international forums is noteworthy said Former Governor of the Reserve Bank of India and Noted Economist, Dr. C. Rangarajan in a fireside chat with Pradeep S Mehta, Secretary General, CUTS International in Chennai. He was speaking on the theme of the lecture ‘Growth Prospects of the Indian Economy ”.

The session was the ninth such event in a series in a series of events commemorating its 40th-Anniversary celebrations (1983-2023). 
America should not allow its trade programme with Africa to die
It is often said that Africa does not matter to America. Unlike China, the U.S. does not pursue a policy of exporting surplus industrial capacity to low-income regions of the world. Accounting for less than 2 percent of U.S. global commerce, Africa remains more the target of aid programming than an economic priority for Washington. This is the context in which to consider the future of the U.S. trade programme (Paywall), the African Growth and Opportunity Act.
Red Sea crisis hurt global trade volumes: WTO DG
The crisis in the Red Sea, one of the world’s busiest trade corridors, hit global merchandise trade volumes in 2023, according to Ngozi Okonjo-Iweala, Director-General, World Trade Organisation (WTO).
 
These disruptions, coupled with a global economic slowdown, likely led to a less than 0.8 percent increase in global merchandise trade volumes in 2023, falling short of the WTO's April projection, Okonjo-Iweala said while speaking at the business forum on the third day of the 13th Ministerial Conference (MC13) in Abu Dhabi.
Tiger in the room at Abu Dhabi
India's foreign policy successes are visible from Jeddah and Medina to Tehran and Abu Dhabi. This is why India should take the lead for a successful outcome (Paywall) of the 13th WTO Ministerial Conference (MC13) in Abu Dhabi, United Arab Emirates (UAE), starting February 26. Otherwise, India may not realise the actual value of its diplomatic initiatives.
 
The last time an MC was held in the Arab world was in 2001 in Doha, Qatar. In the aftermath of 9/11, the global leadership came together to send a strong message to the world that they were together for everybody's benefit. Abu Dhabi is aspiring for such a mark this time, particularly after successfully hosting COP28 in Dubai last year.
‘Indian community is Australia’s second-largest and fastest-growing overseas group’
Australia is currently in the process of deepening and widening its connections with India in general and Karnataka in particular, by expanding collaborations beyond trade and also planning to explore bilateral ties across a wide range of mutual interest areas.
 
Hilary McGeachy, newly-appointed Australian Consul General for Bengaluru, in an exclusive conversation with The Hindu spoke about the business opportunities across technology, innovation, education, training for STEM (science, technology, engineering and mathematics), wetland agriculture, space tech, green energy and indigenous art. especially at a time when the Indian diaspora in the country is on a significant rise.

 

Boosting cooperation in energy, digital infra, ports focus of PM Modi's visit to UAE
Boosting cooperation in areas of energy, ports, fintech, digital infrastructure, railways and investment flows are set to be focus of Prime Minister Narendra Modi's two-day visit to the United Arab Emirates (UAE) beginning February 13, 2024.
 
Following talks between Modi and President of the UAE, Sheikh Mohamed bin Zayed Al Nahyan, the two sides are likely to ink a number of agreements to shore up cooperation in several key areas.
Pitching to assist India to develop EV sector, says Australian envoy
Australia is pitching to become India's key supplier of critical minerals, which would enable the country to develop the electric vehicle industry (Paywall), said its High Commissioner to India, Philip Green.
 
He told Economic Times, close on the heels of Foreign Minister S Jaishankar's Perth trip, that the Indian entities should move fast as the U.S., European Union (EU) and Japan are also sourcing critical minerals from Australia.
India seeks stronger energy ties with U.S.; asserts Russian oil purchases stabilise market
In the midst of geopolitical turbulence sparked by the Ukraine war, India has underscored the importance of its energy partnership with the U.S., citing its strategic purchases of Russian oil as a stabilizing force in global crude markets. According to S&P Global Commodity Insights, Assistant Secretary of State for Energy Resources Geoffrey R. Pyatt revealed that discussions between U.S. officials and India's Petroleum Minister Hardeep Singh Puri highlighted India's perspective on the matter during a recent online interaction with the media.
India seeks US$26 billion of private nuclear power investments
India will invite private firms to invest about US$26 billion in its nuclear energy sector to increase the amount of electricity from sources that don't produce carbon dioxide emissions, two government sources told Reuters.
 
This is the first time New Delhi is pursuing private investment in nuclear power, a non-carbon-emitting energy source that contributes less than 2 percent of India's total electricity generation. The funding would help India to achieve its target of having 50 percent of its installed electric generation capacity use non-fossil fuels by 2030, up from 42 percent now.

 

Need to maintain rules-based Indo Pacific; India-U.S. defence ties come to the fore at Defense News Conclave in Chennai
Former chairman of the Defence Research and Space Organisation (DRDO) S. Christopher on Tuesday, February 5, 2024, emphasised the need for people to people connect between India and the U.S., to strengthen strategic relationships between the two countries.
 
The need to maintain a rules-based order in the Indo Pacific and the emphasis on India-U.S. defence cooperation came to the fore during a Defense News Conclave organised by the U.S. Consulate General Kolkata, the U.S. Department of State and CUTS International, in Chennai.
India-Japan military drill starts in Rajasthan
The fifth edition of joint military exercise ‘Dharma Guardian’ between Indian and Japanese land forces commenced at the Mahajan Field Firing Ranges in Rajasthan. The two-week drill is an annual exercise conducted alternatively in India and Japan. Each contingent comprised 40 personnel. The Japanese contingent is being represented by troops from the 34th Infantry Regiment and the one from the Indian Army is being represented by a battalion from the Rajputana Rifles.
India, France working closely together in Indian Ocean: French Navy Chief
French Navy Chief Admiral Nicolas Vaujour emphasised that India and France have a strategic partnership and both countries are working closely, especially in the Indian Ocean. Admiral Vaujour further said that both countries also have exercises on the bilateral issue. "You know that France and India have a strategic partnership and so we work very closely together, especially in the Indian Ocean and we have exercises on the bilateral issue," he said.
What the U.S. National Defence Industrial Strategy means for the Indo-Pacific
In a first of its kind, the U.S. Department of Defence released a National Defence Industrial Strategy (NDIS) complimenting the priorities of the U.S. National Defence Strategy (NDS). Both the strategy documents reflect the geopolitical environment unfolding in the Indo-Pacific (Paywall), and the threats that the U.S. perceives primarily from the coercive and assertive actions of the People’s Republic of China.
 
Irrespective of leadership changes in Washington, the national security perspective in the country has continually seen China’s military and technological rise as the most prominent strategic challenge to the U.S.
U.S. House passes QUAD bill
The U.S. House of Representatives has passed the QUAD bill which instructs the Biden administration to establish a QUAD Intra-Parliamentary Working Group to facilitate closer cooperation between the U.S., Australia, India and Japan. Passed by a roll call vote of 379 to 39 votes, the ‘Strengthen U.S.-Australia-India-Japan Cooperation’ or the QUAD bill says that the joint cooperation between the U.S., Australia, India and Japan should be strengthened.
U.S. commander touts enhanced military ties with Japan; critics decry U.S. of self-deception
Samuel Paparo, the commander of U.S. naval forces in the Pacific, has lauded the strengthened military alliance between the U.S. and Japan as a key achievement of the U.S. "Indo-Pacific strategy," which was unveiled two years ago. However, Chinese observers caution that such boasts and bolstering efforts are fundamentally displays of military prowess, reflecting the U.S.' inclination to wield its military superiority in addressing regional affairs. This approach, they warned, poses a significant threat to regional stability and peace.
India, Germany set to carry out joint military exercise in Indo-Pacific
India and Germany have resolved to closely collaborate on high-technology for military use in line with a broader aim to develop defence cooperation as a key pillar of the bilateral strategic partnership. Ways to further bolster strategic cooperation figured prominently at a meeting of the India-Germany high defence committee that was held in Berlin.

 

U.S.-India Business Council launches task force to align leadership between two nations on artificial intelligence
The US India Business Council announced the launch of its Artificial Intelligence Task Force (AI-TF) which it said is a pivotal step in aligning U.S. and Indian leadership on AI. The business body, which represents leading global companies operating across the U.S., India, and the Indo-Pacific region, said that AI-TF will advance AI concepts and principles, drive multi-stakeholder processes, and promote the development and commercialisation of AI technologies.
India-Australia defence nexus hinges on trust, technology transfer
India-Australia defence deal: The strategic balance of the Indo-Pacific has undergone significant changes in recent years with the rise of China as a major power and its increasingly assertive presence in the region.
 
The situation has prompted India and Australia, as well as other members of the QUAD group, to seek closer cooperation to ensure a stable and prosperous region. Although there is an agreement to cooperate on trade and co-production of defence equipment between the two countries, progress has been negligible.
India, the U.S. looking into exciting joint science & technology projects to further expand ties: says top American scientist
India and the U.S. are looking into exciting joint science and technology (Paywall) projects to further expand their relationship under the guidance of the top leadership of the two countries, according to a top American scientist. Describing the U.S.-India Partnership as a very important one for the Biden-Harris administration and also in Congress, Dr Sethuraman Panchanathan, Director of the National Science Foundation said there's total bipartisan support for a strong partnership between two great democracies, the U.S. and India.
India Aims to Secure 10 Percent of 6G Technology IPRs
India is targeting a 10 percent share of Intellectual Property Rights (IPRs) in sixth-generation (6G) technology through collaborative efforts led by the Department of Telecommunications (DoT)ss, Department of Science and Technology (DST), and other relevant entities, as highlighted by a senior official from the Ministry of Electronics and IT (MeitY). Meenakshi Agarwal, Scientist 'D' at MeitY, underscored the importance of strengthening privacy and cybersecurity regulations, as well as the development of energy-efficient technologies, according to an official statement.

 

Engaging the Indian-Australian diaspora
An extraordinary and exciting partnership between India and Australia has been forged in less than a decade, with promise of a collaboration that could credibly become a pivot in the Indo Pacific, especially at a time when the region faces a hostile and adversarial environment.
 
For this to happen, however, it is important to recognise that while the government can be the principal initiator, the role of multiple stakeholders, including the diaspora often referred to as ‘the human bridge’ between nations plays a significant role.
Next G20 Summit in Brazil
This edition of the CUTS Occasional News Wrap (ONW) covers the key takeaways and achievements of the outgoing G20 chair, India and encapsulates the expectations from Brasil as the Chair for 2024. It compiles articles from both electronic and print media, spotlighting the G20 Summit in Brasil in 2024. Pradeep Mehta, Secretary General of CUTS International in Jaipur, has attained a significant honour through his appointment as a member of the International Advisory Council of T20 Brasil. Additionally, Mr. Mehta has received a nomination for B20 Brasil membership.
U.S. Consulate and CUTS International organise workshop in city
The U.S. Consulate General Chennai, the U.S. Consulate General Kolkata, and CUTS International organized a day-long workshop in Chennai today entitled “Defense News Conclave: Stories of U.S.-India Defense and Security Partnership” to highlight the strength of the bilateral defense and security partnership between the United States and India, and the growing U.S.-India strategic relationship in the Indo-Pacific region.
Your visit will boost India-France friendship: PM Modi to Macron
The French president was on two-day visit to India last month and was the chief guest at the Republic Day celebrations here on January 26. Macron shared a video montage from the visit on X and wrote, "A look back at an exceptional trip in India." Tagging his post, Prime Minister Modi said, "It was an honour to have you in India, President @EmmanuelMacron." "Your visit and participation in the Republic Day celebrations will surely boost India-France friendship," he said.
2024 is year of consolidation, focus & results in India-U.S. ties: Richard R Verma
Richard R Verma is a familiar figure in Delhi. A former U.S. Ambassador to India during the second Barack Obama presidency, he is now the Deputy Secretary of State (management and resources), the highest rank attained by any Indian-American in America’s diplomatic arm.
 
After returning from his first trip to South Asia as deputy secretary, he spoke to HT in Washington DC about his visit, the evolution of India-U.S. relations, divergences and institutional issues, and the global geopolitical climate.