International trade

In view of the growing importance of services in the economy and the significance of the multilateral framework for enhancing India's trade prospects in the sector, liberalisation of trade and investment in the services sector is especially important.

The agreement on capacity cuts in steel reached at the Paris meeting of producing countries this month is under threat of being undermined by a US proposal to impose tariffs on imports. The International Trade Commission, a US government agency, has recommended duties of up to 40 per cent on most import items, in a bid to protect the high-cost, loss-making US steel industry. Steel exports to the US, including from India, will virtually dry up if president Bush endorses the tariffs in February 2002. The European Union has already declared that the Paris deal would not be implemented if the US went ahead with its import curbs. The EU is also preparing for action at the WTO if the US does not back off. With the hardening of positions, some tough bargaining must precede any concerted international effort to shore up the global steel industry, which is facing its worst crisis in decades, with a production glut and poor demand pushing down prices to 20-year lows.

World Trade Organisation: An Indian Perspective by Jayanta Bagchi; Eastern Law House, Kolkata, 2001; pp 243, Rs 400.

The biggest gain for India from the fourth ministerial conference of the World Trade Organisation that concluded at Doha on November 14 is that a fresh round of trade negotiations has been kicked off. It is also to India’s advantage that the Doha meet has incorporated into the WTO agenda several concerns of developing countries and by doing so promises to take the process of globalisation and global integration ahead. India played a proactive role in the negotiations. Although it could be argued that trade minister Maran and his team displayed more vigour in pushing what have come to be identified as India’s national postures than in correctly identifying what indeed are our national interests, there is no gainsaying that India played an important role in securing a major achievement of the summit – developing country assertion of their interests.