India has taken a firm stance against a proposal led by China regarding investment facilitation at the World Trade Organization (WTO), citing it as a non-trade issue and outside the purview of the global trade body.
The opposition comes amidst efforts by a group of over 120 countries, spearheaded by China, to push the Investment Facilitation for Development Agreement (IFD) proposal onto the agenda of the 13th ministerial conference (MC) of the WTO.
The four-day conference, which commenced on February 26, has become a platform for contentious discussions regarding the inclusion of non-trade issues within the WTO framework.
An official representing India stated, "India believes that the WTO should deal with issues related to trade and this is a non-trade issue and India is against bringing this into the WTO framework."
The proposal, aimed at integrating investment facilitation measures into the WTO's agenda, is being advocated through annexure-4 of the WTO, which would render it binding only on signatory members.
India has raised concerns over the legitimacy of such a move, emphasizing that the introduction of non-mandated, non-multilateral issues violates the foundational principles of consensus-based decision-making within the WTO.
India has highlighted the vested interests behind the proposal, suggesting that it serves the interests of specific groups rather than fostering genuine multilateral cooperation. While the WTO allows member countries to form agreements among themselves, such agreements must adhere to the principles of consensus and mandate of the organization.
The IFD proposal, initially proposed in 2017 by China and countries reliant on Chinese investments, has drawn scrutiny from India and other nations wary of its implications. Additionally, India has signaled its opposition to further extensions of the e-commerce moratorium beyond March 31, 2024. The moratorium, which has been in place since 1998, exempts electronic transmissions from customs duties, a policy that has sparked debate within the WTO.
India, along with several other developing nations, has advocated for the termination of the moratorium, citing the need for fair trade practices and revenue generation. Conversely, developed nations are advocating for the permanent adoption of duty-free digital transmission, highlighting the divergent interests at play within the WTO.
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