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General Studies 2 >> International Relations

WTO MINISTERIAL CONFERENCE

WTO Ministerial Conference

Source: The Hindu
 

Context

WTO concluded the Ministerial Conference's Twelfth outing (MC 12) securing agreements on relaxing patent regulations to achieve global vaccine equity.
 
Ensuring food security, according to subsidies to the fisheries sector and continuing moratoriums relevant to e-commerce, among others. 'Together they constitute the ''Geneva Package".
 
 

What is the WTO's Ministerial Conference?

  • The MC is at the very top of WTO's organisational chart.
  • It meets once every two years and can take decisions on all matters under any multilateral trade agreement.
  • Unlike other organisations, such as the International Monetary Fund or World Bank, WTO does not delegate power to a board of directors or an organisational chief.
  • All decisions at the WTO are made collectively and through consensus among member countries at varied councils and committees.
  • This year's conference took place in Geneva, Switzerland, it is co-hosted by Khazikisthan.
 

Key points

  • The Trade-Related Aspects of Intellectual Property Rights (TRIPS) regime on vaccines during public health emergencies such as the Covid pandemic.
  • Loosening the rules on public stock holding for food security purposes, reducing or eliminating, subsidies on fisheries, resolving contentious issues in e-commerce and reforming the WTO.
  • It is worth noting that the ministerial conference is the top decision-making body of the agency. The basic goal is to ensure that trade flows as smoothly, predictably and freely as possible, based on some agreed-upon rules.
 

Debates around the agriculture 

  • As far as agricultural, trade and food security are concerned, the challenge is to figure out the most appropriate trading rules in dire situations or natural disasters.
  • Many countries become inward-looking in such times and impose outright export bans citing domestic food security needs.
  • Recent examples include Russia's export ban on wheat and sunflower oil, Ukraine's ban on exports of food staples, Indonesia's ban on Palm oil exports (It was lifted last month), Argentina's ban on beef exports, Turkey, Kyrgyzstan and Kazakhstan's ban on a variety of grain products and India's wheat export ban.

Significant debates on India

  • The agreements on the subject are of particular significance to India.
  • India has a significant contribution to the World Food Programme (WEP).
  • It stated that it had never imposed export restrictions for procurement under the programme.
  • It put forth that a blanket exemption could constrain its work in ensuring food security back home.
  • Negotiators agreed that member countries would not impose export prohibitions or restrictions on foodstuffs purchased for humanitarian purposes of the WFP.
  • The decision would not prevent member countries from adopting measures for ensuring domestic food security.
  •  
  • Negotiators could not reach agreements on issues such as permissible public stockholding of domestic food security, domestic support for agriculture, cotton and market access.
  • The central premise agreement was to ensure the availability, accessibility and affordability of food in humanitarian emergencies.
  • Member countries were encouraged with available surplus to release them on international markets in compliance with WTO regulations.
  • It helps LDCs (least-developed countries) and NFIDCs (Not Food Importing Developing Countries) through work programmes to enhance their domestic food security and support agricultural production.
 

India's major imports 

  • Indian edible oil bill in 2021-22 crossed $19 billion. India imports 55 to 60 per cent of its oil requirements.
  • India's Agri-exports in FY22 touched $50.3 billion against its agri-imports of $32.4 billion.
  • Indian agriculture is largely globally competitive but its biggest agri-import item, edible oil, accounts for 59 per cent of the agri-import basket.
  • Despite high import duties that have generally been imposed on edible oil imports are followed by fresh fruits and vegetables, pulses, spices and cashew among others.
  • The excessive dependence on imports has raised the pitch for Atamanibharta in edible oil.
  • The Prime Minister launched the National Edible Oil Mission-Oil Palm (NEOM-OP) in 2021.
  • Achieving atmanirbhata in edible oils through traditional oilseeds such as mustard, groundnuts and soya would be required an additional area of about 39 million hectares under oilseeds.
  • Such land will not be available without cutting down the area under key cereals.
  • This could endanger the country's food security even more.
  • A rational policy option to reduce import dependence on edible oils is to develop oil palm at home to ensure that it gives productivity comparable to that in Indonesia and Malaysia about four tonnes of oil per hectare.
  • It is 10 times what mustard can give at existing yields.
    India has identified 2.8 million hectares of the area where oil palm can be grown suitably.
  • The objective of NEOM-OP is to bring in at least 1 million hectares under oil palm by 2025-26.
  • The problem with oil palm is that it is a long gestation period crop. It takes four to six years to come to maturity. 
  • During this period, smallholders need to be fully supported.
  • The support (subsidy) could be the opportunity cost of their lands, say profits from paddy cultivation, which is largely the crop oil palm will replace in coastal and upland areas of Andhra, Telangana and Northeast India.
  • The pricing formula of fresh fruit bunches for farmers has to be dovetailed with a likely long-run average landed price of crude palm oil with due flexibility.
  • The other option is to declare oil palm as a plantation crop and allows the corporate players to own or lease land on a long-term basis to develop their plantations and processing units. it is not plausible in the current socio-political context.
  • India thinks holistically and adopts a long-term vision to reduce its imports from 14MMT in FY22 to 7MMT by FY 27 look bleak.
 

Fisheries-related agreements

  • India is successfully managed to carve out an agreement on eliminating subsidies to those engaged in illegal, unreported and unregulated fishing.
  • Overfishing exploits fishes at a pace faster than they could replenish themselves.
  • Currently standing at 34 per cent as per the UN Food and Agriculture Organization (FAO).
  • Declining fish stocks threaten to worsen poverty and endanger communities that rely on aquatic creatures for their livelihood and food security.
  • According to the agreements, there would be no limitation on subsidies granted or maintained by developing or least-developed countries for fishing within their exclusive economic zones (EEZ).
 

Moratoriums on electronic transmissions

  • Member countries agreed to extend the current moratorium on not imposing customs duties on electronic transmission until MC13 ( scheduled to take place in December 2023. India and South Africa opposed it.
  • ETs consist of online deliveries such as music, e-books, films, software and video games.
  • They differ from other cross-border e-commerce since they are ordered online but not delivered physically.
  • The moratorium would help maintain certainly and predictability for businesses and consumers, particularly in the context of the pandemic.
  • India and South Africa citing data from the UN Conference on Trade and Development submitted that extending duty-free market access due to the moratorium resulted in a loss of $10 billion per annum globally 95 per cent of which was borne by developing countries.
  • Customs duties have been traditionally used to avert an undesired surge in imports, allowing nascent domestic industries to remain competitive.
  • Developing countries need to import sizeable equipment and services for upscaling their digital capabilities.
  • Customs duties provide the necessary capital infusion for capacity building and in turn, attempt to address the digital divide particularly high in low-income and developing countries worsen by the covid-19 pandemic.
  • India and South Africa had sought to preserve policy space for the digital advancement of developing countries by letting them generate more revenues from customs and thereby facilitating more investment.

 

Patent relaxations

  • Member countries agreed on authorising the use of the subject matter of a patent for producing Covid-19 vaccines by a member country, without the consent of the rights holder.
  • It asks member countries to waive requirements, including export restrictions set forth by WTO regulations to supply domestic markets and member countries with any number of vaccines.
  • The agreement is too late for economically poorer countries.
  • Several LDCs have suffered in their efforts to combat the pandemic, owing to factors stressed balance of payments situation, different levels of development, financial capabilities and varying degrees of import dependence on those products.
  • Within the next six months, members are expected to decide on increasing the scope of the agreement to cover the production and supply of Covid-19 diagnostics and therapeutics as well.
 
 




 
 
 




 
 
 
 
 
 
 

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