A Thumbs Down To Unilateralism

Moderator
By Moderator July 1, 2019 14:48

Biswajit Dhar, Professor, Jawaharlal Nehru University discuss the trade war. This article is for a “thumbs down to unilateralism”.

Unilateralism: Unilateralism is an approach in international relation in which a state takes decision by itself without the consent of other states. Decisions are made for their own good rather than the common good. Example US unilaterally backs out of Paris climate accord 2017.

 

Background: The U.S government, India’s largest trading partner took series of unilateral actions against India’s export during 2018 followed by India’s retaliation to hike tariffs of 28 products. After china it seems like India has become the next target of Trump’s administration

 

Issues pointed out by US agencies

The Office of the United States Trade Representative (USTR) and the United States International Trade Commission (USITC) — have investigated India’s trade policies, the conclusions of which are

  • American businesses strongly disapproved several of India’s key policies on trade and investment and that these policies had to be amended.

  • The investigations conducted by the U.S. agencies raise several issues of propriety, procedures and substance

Analysis (unilateral actions of U.S):

  • All of the India’s trade related policies that were questioned by USITC reports were done under the cover of the U.S.’s domestic laws. This action amounts to unilateralism.

  • The procedure followed for conducting these investigations were deeply flawed and mired with vested interest

  • Issues pointed out by the U.S agencies have already been dealt by WTO.Therefore the issues of propriety, procedures needs to be addressed within WTO forum.

  • since the establishment of WTO ,India’s trade rules has been mostly consistent with global trade rules which is evident from the fact that no country including U.S have approached Dispute settlement body to make India fall in line with global trade rules

  • Also India’s high tariffs which has been the concern for U.S were all agreed in the Uruguay Round negotiations in consultation with all members of the organisation.

  • Moreover over a period India has significantly reduced tariffs on many agricultural and industrial products contrary to this U.S continues to defend its high levels of agricultural subsidies which are used for lowering commodity prices to levels at which no other country can have access to its domestic market

  • The WTO also informs us that the U.S. also uses very high tariffs on tobacco (350%), peanut (164%) and some dairy products (118%).

Way forward: The U.S. is acting in defiance of agreed rules to target India’s WTO-consistent policies. In this age of multilateralism, where differences on policy issues between sovereign countries must be settled in the appropriate multilateral forums. The possibilities of a stronger power using unilateral means should be eliminated. It is in this spirit that the General Agreement on Tariffs and Trade (GATT) was established as an integral part of the post-war global economic governance. GATT was replaced by the World Trade Organization (WTO) in 1995.

 

Also read:

Maratha Reservation Verdict By High Court: An Analysis

The Legal Provisions for Women

Source: The Hindu

Moderator
By Moderator July 1, 2019 14:48