From correspondents in Europe, 09:45 AM IST

The Doha Development Round of the World Trade Organisation (WTO) is clearly at a defining moment now, especially after the failure of the recent negotiations in Geneva. At the Hong Kong Ministerial Conference in December, all countries had agreed to a timetable for conclusion of the negotiations by the end of 2006. This meant that a substantial part of the negotiations had to be completed by July if deadlines were to be met.

Unfortunately, this did not happen, as the expectation from the developed countries was that the developing countries would need to show greater flexibility in the opening up of their markets. We find this somewhat unfair.

Since the majority (three-fourths) of the 149 WTO members are developing and poor countries, it is only natural that their concerns should occupy center-stage in the negotiations that determine the working of the WTO or the multilateral trading system.

Countries like India, for instance, see opportunities in globalisation but at the same time we feel it is necessary to be cognisant of the challenges that the globalisation process ushers in. The central challenge facing developing countries is that of poverty. It is a fact that even today there are several countries where people are not guaranteed one square meal a day. In many countries, people are forced to live on less than $1 per day.

Even in an economy like India, which is enjoying sustained high economic performance, development is not uniformly spread and poverty remains a critical challenge. Indeed, Prime Minister Manmohan Singh has repeatedly stressed that the objective of the economic and fiscal policies of his government is to ensure that the benefits of growth are spread to all sections of the people so that the challenge of poverty may be addressed.

One of the stumbling blocks in the current negotiations is agriculture. Around 70 percent of the world's poor live in rural areas. In the case of India, we are essentially an agrarian economy. Over 650 million of our people are directly dependent on agriculture for their survival.

India's Commerce Minister Kamal Nath has repeatedly emphasized, therefore, that subsistence agriculture is not open for negotiation, nor would any moves that could lead to de-industrialization in the developing and the least developed countries be acceptable. When the negotiations collapsed earlier this month in Geneva, he said, 'Commerce is for negotiations, not subsistence.'

Non-governmental organisations have estimated that the subsidy provided to agriculture in developed countries is in excess of $280 billion, which is more than the gross domestic product of several poor countries put together. Developing countries are, accordingly, asking that these heavy farm subsidies given by developed countries need to be effectively reduced.

Unfortunately, developed countries are refusing to reduce their subsidies other than by token amounts. Unless these trade-distorting subsidies are dismantled, access to the markets of rich countries would remain denied to agricultural products from the poor countries.

If you look at the issue of industrial tariffs, which is another issue of concern, India had provided market access unilaterally since the Uruguay Round - in fact, the overall reduction amounted to 55 percent in the last five years whereas developed countries like the US and the EU had made no reduction at all since the Uruguay Round. The Indian commerce

minister, therefore, said that in all fairness, it is essential for the US and the EU to do more to reduce industrial tariffs as mandated. Linked to this is the issue of high tariff peaks in the developed countries.

Developed countries took more than 50 years to bring their tariffs down so that their indigenous industry could reach where they are today. Similar sensitivity needs to be shown with regard to the domestic industry in developing and least developed countries, especially small scale and infant industries.

If you take the subject of services, developed countries have sought to open up markets in developing countries while seeking one pretext or another in ensuring that their own markets remain closed. Consider a simple example: India has come to be known globally for its IT capabilities.

Thomas Friedman in his recent path-breaking book had argued that India was going to use IT as an instrument to level or flatten the playing field. What India has proposed at the WTO negotiations is known as the Mode 4 proposal and simply says that if the market has a demand for professionals, such professionals should not be denied short-term entry or access.

Unfortunately, at one level we are being told of the immigration sensitivities. At another level, we are quoted figures of high unemployment in developed countries, so that our legitimate demands under services may be shelved.

Basically, what it boils down to is market access. Development can be at the core of the trade agenda only if access to the markets in rich countries is not denied to the products of poor and developing countries through tariff and non-tariff barriers. The current play in negotiations unfortunately suggests that this is not happening.

Our concern is that the current round may head for failure unless development concerns are placed at the core of the negotiations. In conclusion, the real challenge before the WTO is to find the will to redeem its original pledge and mandate and to have the courage to honour the development promise of Doha.

(Meera Shankar is India's Ambassador to Germany. The above article is drawn from a recent speech she delivered at the University of Applied Sciences in Berlin.

She can be reached at ssinfo@indianembassy.de)

(Staff Writer, © IANS)