Shape of IPRs and Agriculture post the WTO Nairobi Ministerial

Extension of abeyance of Non- violation complaints

At the Nairobi Ministerial, members agreed to extend the non-applicability of non-violation complaints for two years. There are two kinds of disputes which can be initiated at the WTO -first, when the partner country does not fulfill a commitment and such a non-implementation is injures the member country, leading to either nullification or impairment. Second, a country may deem itself to be injured even though the partner country has fulfilled its obligations. For instance, despite India's compulsory license grants complying with TRIPS, the US initiated a dispute against India.

Need for greater negotiating muscle and coalition building at multilateral fora

The Convention on Biological Diversity(CBD) came into force in 1993, followed by the TRIPS agreement in 1995. India became a member of the CBD and gained sovereign rights over its diversity. Before CBD, inventions related to diversity were protected by private rights. The turmeric case, and increasing bio-piracy led to introduction of requirement of disclosing the source. India proposed that along with other details, the source of the biological material should be mandatorily disclosed, including any associated traditional knowledge. Subsequent benefits arising out of use of biological resources had to be shared with the country- it was important to acknowledge that the community had nurtured these resources. The coalition in favour of the disclosure requirement was an interesting one because it was between India, Brazil, sometimes South Africa, Andean countries and Pakistan. This was pushed for in WIPO where the need for a treaty was advocated. The consensus around the disclosure requirement was an example of developing countries forming coalitions to make their interests more pronounced.

Further, greater the evidence, better is a country’s case in negotiations. After the Turmeric case, India realised that it needs written and not oral evidence to produce in the US Courts. That realisation led to the creation of a documentation project for traditional knowledge(Traditional Knowledge Library Database). Since the last decade, India has been sharing this database with patent officers. Since 2009, TKDL has also contested patents in various jurisdictions. At the EPO, India contested 94 patents, while in Canada the number is 25. Although there has been some success in US but major success has been in EU only. However, there is a shortage of manpower to work on the challenges, and as a consequence the efforts have largely failed to push the process of the law. Mounting these challenges also proves to be be exorbitantly expensive. There are indeed very few countries which have effectively done this without succumbing to international political pressure- India is one of them. It is possible to use this democratic space wisely to push back the dominant powers.

Trade is imminent and there will be trade. However, if we do not deal with trade effectively, it will spell doom for us. The Transpacific Partnership(TPP) and Nairobi ministerial should serve as a warning for us. The prevalent fear has been that countries in favour of TPP will be multilateralised. India's steps indicate a roll back of its role at the WTO. Once it moves out of the WTO framework and the Doha agenda fails, TPP signatories will begin to exert pressure on WTO. Granted that there is very little window to move forward, nevertheless, India should try using its influence to fight at the WTO with all resources available. WTO has limitations but such organizations are the only bet we have against multilateral organizations. Currently, India is allowing these organizations to be shaped in an undesirable manner. We have not used the WTO truly well enough, and neither have we been able to influence ongoing negotiations. There is, therefore, a need to rethink our strategy. It is time to step up and engage with lawmakers instead of only engaging with bureaucrats.

Negotiating teams at these multilateral fora are of utmost importance, because of their unique position to influence the law making process at the top-down level. In the long term, they are also a cost saving measure (compared to mounting opposition to patents, etc). Unfortunately, India has kept silent as it watches US and its allies taking over ASEAN. Through TPP, rules are changing and the US-led alliance is taking over countries beyond Pacific Rim, by moving into ASEAN. India is in an isolated position right now and needs a group of its own to collaborate and work as a formidable force against US.

India should have seized the opportunity to group with African nations in the India-Africa forum to consolidate its position. Similarly, Latin countries may also be pursued. These regions are important since India's support at the WTO has been on a sharp decline.

Agriculture

India is also under pressure to remove agricultural subsidies. The subsidy regime was crafted by the EU and US to enable them to exempt their subsidies in an exempt list (green box). Further, US cleverly protected its own export credits so that its own subsidies became exempt. In this manner, even subsidies pertaining to export competition are not totally eliminated. However, other countries like India have raised an issue that in these countries, export subsidy is but one part of total subsidies. The latter has come down and this is problematic because countries like India simply must have potential to safeguard against hunger. The public distribution system is essential for this. India has a system of Minimum Support Price(MSP) and input subsidy. On the other hand, US provides direct income support, arguing that markets should be as close to their pristine form as possible. And input subsidy and MSP do not reconcile with this. According to them, income transfers are better because that does not manipulate prices.

In US and EU, the irony is that, they have farm policies. US has had a farm bill every 4 years since 1933, and EU has a common agricultural policy. India does not have any such policy. The US and EU inform their producers their about expected subsidies for the next 4 years, enabling the producers to plan in advance. In this case, income transfer can work. Therefore, the farmers can take higher risks and can manipulate prices. Their farm rate price is well below the economic cost and international price since they have protection because of the income transfer. The international price is supposed to be efficient (in almost 3 decades, international prices have been same). Since their prices are below international prices, they can dump in the international market. On the other hand, nobody else can enter the US market. Ironically, this income support, which affects international trade so unfairly, is kept out of the scope of WTO deliberations - no questions asked. Further, while the US Farm Bill expenditure has gone up, in contrast, India has a limit on subsidy. Food subsidy is counted in the 10% limit prescribed by the WTO.

The situation is can be summarised as, thus: US's activities eventually escape the WTO, while Indian programmes fall within the scope, more than the usual. Before the Food Security Act, the below poverty line population were the only beneficiaries. And now, the Act benefits two-thirds of the population. As a result, quantum of subsidized food has gone up. If the government decides to give income transfers (instead of subsidies), in order for it to be successful, the tiller has to be the owner of the land, which is problematic in India. Although people want to follow direct benefit transfer for agriculture as well, the question remains that how many workers will actually benefit from it.

It is evident that agriculture is suffering- Mint recently reported on how India is becoming an agro importer. Sugar output has suffered. India might import sugar next year along with pulses, wheat. Productivity is going down. This is will make way for support for genetically modified crops-- which is again what the US wants. If the WTO gets populated by TPP signatories, India cannot continue with providing subsidies because TPP eliminates agricultural subsidies. The only relevant factors are market entry and tariff. This could be agriculture’s deathbed.

Negotiations on agricultural issues have not been effective because of divisions within it. Fragmentations have caused a lack of unity - even a bare common minimum position does not exist. Further, US and allies have used diversionary tactics such as repeatedly asking for evidence, not bringing anything concrete to the table, etc. When the process is frustrated frequently, activist movements also die down.

Loss of bargaining power has led to fatigue within various activist groups in the country. On the other hand, corporations continue prospering. India had put up a strong fight for TRIPS flexibilities, but today elements like TPP are destroying balanced regimes across the world.

Thanks to our intern Aniruddha Majumdar for his assistance on this post.