Sino-Indian farm trade proposal is a new paradigm to safeguard the interests of developing countries

By Wang Jiamei Source:Global Times Published: 2017/8/28 20:48:39

A joint proposal submitted by China and India recently to the WTO argues for a rule change in global farm trade, indicating that there is still scope for cooperation between the two rising powers given their common stance in the international trade order.

China and India jointly called for the elimination of the Aggregate Measurement of Support (AMS), a trade-distorting subsidy the US, the EU, Canada, Japan, Switzerland and Norway use to provide support to their agricultural sectors, according to a report by Indian business news website livemint.com on Sunday.

With most developing countries unable to offer product-specific AMS subsidies, China and India demanded in the joint proposal that "the AMS entitlements of developed members must be eliminated as a prerequisite for consideration of other reforms in domestic support negotiation ... Only in this way will it help reduce some of the inequities built into the WTO rules in favor of developed members." according to the report.

The joint proposal is a clear demonstration of how the two largest developing countries can join hands to safeguard the interests of all developing countries at the WTO. Much has been said about the competition between China and India, which is inevitable for the two fastest-growing developing countries, but they also have common ground. In such areas as trade, a degree of cooperation is in the interests of both countries and of the entire developing world. Against the background of the lackluster global economy and anti-globalization backlash, developing countries, in particular the two largest ones, need more than ever to work together to counter unfair trade treatment.

The voices of China and India, which together account for one-third of the world's population, should not just be heard in the global trade regime. It is under the BRICS mechanism that cooperation between the two could help developing countries gain more say in international affairs. The BRICS countries (Brazil, Russia, India, China and South Africa) have contributed more than 50 percent of global economic growth over the past decade, with their population and trade accounting for 43 percent and 17 percent of the world's total, respectively. Moreover, the BRICS had a bigger say in many international issues in recent years, such as climate change, financial reform, trade friction and other global governance issues.

The common stance on farm trade adopted by China and India is essential to give the BRICS a louder voice and lead to an improved representation of developing countries. Coordination between the two under the BRICS mechanism should be encouraged to create more a favorable international environment for economic growth and financial stability in developing countries.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn

Posted in: EYE ON THE ECONOMY

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