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In February, India suggested convening a meeting under the aegis of the WTO to discuss the role of e-commerce during the COVID-19 pandemic. Many WTO member nations admitted the help their economies received from e-commerce during pandemic-induced lockdowns. Indian ambassador to WTO Brajendra Navnit suggested that this agenda item should be adopted by the General Council as a standing agenda item for every meeting.
India continued to put forward its recommendations on e-commerce and agriculture at the WTO this year, with Indian commerce and industry minister Piyush Goyal calling for correcting ‘the historical asymmetries and imbalances’ in agriculture regulations and finding a permanent solution to public stockholding and the Special Safeguard Mechanism.
At the 12th WTO Ministerial Conference in Geneva in June, Goyal urged WTO members to review and relook the continuation of the moratorium on customs duties on e-commerce as the issue had huge implications for the economy of developing countries.
Increasing participation of the developing countries in trade in electronic transmission continues to be a challenge due to the huge digital divide that exists between the developed and the developing countries.
Eighty six out of 95 developing countries are estimated to be net importers of digital products and only five big tech giants are controlling the market. They make super profits, have high market capitalisation, and do not allow new entrants in this space due to their financial clout and influence.
The minister said that while small exporters of physical products like textiles, handloom, clothing, footwear, mainly based in the developing countries, are facing both domestic taxes as well as customs duties, the big digital exporters are being exempted from custom duties due to the moratorium.
“This will actually jeopardise domestic manufacturing capacities which will be subjected to regular tariffs, which would actually become totally uncompetitive. I think this moratorium which has been continuing for 24 years needs to be reviewed, relooked at,” Goyal said.
During 2017-2020, developing countries reportedly lost potential tariff revenue of possibly upward of $50 billion only on import of 49 digital products, he said. Ninety five per cent of this revenue tariff loss is borne by the developing countries, he added.
Special Safeguard Mechanism (SSM) of the WTO is a special protection mechanism for developing countries that allows developing countries to raise tariffs on agricultural imports that are injurious to domestic farmers.
“India and all of us in this G33 group of members have long been calling for accessible and effective SSM in order to address the destabilising and crippling effects of import surges and downward price movement largely due to huge subsidies by the developed members,” Goyal told the same conference.
The Agreement on Agriculture, which is already riddled with ‘deep imbalances’, favours the developed countries that have created the rules against many developing countries and that is quite evident now, he emphasised.
Ministers of Australia, Japan and Singapore, who are co-convenors of the WTO’s e-commerce negotiations, along with Switzerland launched the E-commerce Capacity Building Framework to strengthen digital inclusion and help developing and least developed countries (LDCs) harness digital trade opportunities.
Fibre2Fashion News Desk (DS)
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