India’s WTO Strategy

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Context:

China’s announcement to forgo Special and Differential Treatment (SDT) at the WTO has implications for India’s trade and subsidy policies.

Trade and Subsidy Pressures

Global Trade Context: China’s decision at the UN General Assembly signals potential pressure on India to conform with WTO rules while preserving domestic subsidies.
Agricultural and Industrial Vulnerability: India’s reliance on SDT supports subsidies for farmers, agriculture, and public sector manufacturing, which face constraints if phased out.
Food Security Risks: Phased removal of subsidies could reduce rural incomes by 10-15%, aggravate food price volatility, and increase malnutrition among children.

Strategic Policy Options

Developed Country Comparison: Developed nations’ subsidies exceed global norms, yet India must defend its Green Box exemptions while expanding domestic capabilities.
Sectoral Reforms: India should prioritize non-essential tariffs, enhance data localization, and strengthen digital commerce networks without breaching WTO rules.
Innovation and Industrial Policy: Encouraging technology adoption, supply chain resilience, and domestic production in strategic sectors is key to offsetting SDT reduction impacts.

Future Engagement

International Negotiations: India must negotiate carefully on tariff-free access, data rules, and standards alignment, balancing trade benefits and domestic interests.
Intellectual Property and Digital Trade: Maintaining IP rights while promoting e-commerce and digital trade ensures competitiveness and innovation.
Strategic Preparedness: India needs a medium-term WTO strategy aligned with economic growth, domestic welfare, and sectoral competitiveness before SDT obligations change.

Practice Question:

Examine the implications of China’s decision to forgo Special and Differential Treatment (SDT) at the WTO for India. Discuss strategies India should adopt to safeguard its agriculture, industry, and digital trade sectors. (250 words)

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