Leeway on services could see talks through: WB
A WB handbook on trade in services has suggested that success of services negotiations at the WTO would depend on developed countries as well as large industrialised nations.
By TNN |
NEW DELHI: A World Bank handbook on trade in services has suggested that success of services negotiations at the World Trade Organization (WTO) would depend on developed countries as well as large industrialised nations agreeing not to impose new restrictions on services. They should also commit to eliminate restrictions on foreign direct investment (FDI) and allow greater freedom for movement of individual professionals.
The study, released on Friday, points out that if OECD countries were to allow temporary immigration of foreign service providers equal to just 3% of their labour force, the global gains would be worth over $150 billion — more than three times total development assistance flows.
While services negotiations under the multilateral WTO have reached an impasse, India is trying its best to fast-track its negotiations on services with the EU under the bilateral trade and investment agreement being worked upon. Speaking at a Ficci seminar organised to discuss the World Bank study, additional secretary in the commerce department Rahul Khullar said an exclusive meeting on services with the EU has been scheduled in 10 days.
The India-EU bilateral agreement would include goods and services as well as investments. Efforts are being made to conclude the talks by the year-end.
On the WTO negotiations, Mr Khullar said services were important for the Indian economy and negotiations in this area had remained a non-starter. “In the Doha round, services negotiations have not really taken off due to the logjam on agriculture and industrial goods. Until the logjam on agriculture and non-agricultural market access ends, nobody will talk on other things,” he said.
It was ironical that areas like agriculture in which there was not much to be gained were holding up progress in talks at WTO, Mr Khullar said. Global trade in services stands at $3 trillion, of which India accounts for $80 billion.
According to World Bank chief economist Aaditya Mattoo, services negotiations at the WTO offer India a golden opportunity to secure access to foreign markets and to spur domestic reforms. Moreover, India, through its visionary leadership, can transform the Doha services negotiations by proposing a package that is balanced, commercially-relevant and supports development,” Mr Mattoo said.
The handbook pointed out that a promise not to impose new restrictions on trade in services would dispel the spectre of protectionism that hangs over outsourcing of business services. A credible promise to eliminate barriers to FDI, either immediately or gradually, where regulatory inadequacies need remedies was required for complementary reforms, the publication added.
Another important ingredient of a successful services package would be an agreement to allow greater freedom of international movement for individual service providers in order to fulfil specific services contracts, the handbook advised.
The study, released on Friday, points out that if OECD countries were to allow temporary immigration of foreign service providers equal to just 3% of their labour force, the global gains would be worth over $150 billion — more than three times total development assistance flows.
While services negotiations under the multilateral WTO have reached an impasse, India is trying its best to fast-track its negotiations on services with the EU under the bilateral trade and investment agreement being worked upon. Speaking at a Ficci seminar organised to discuss the World Bank study, additional secretary in the commerce department Rahul Khullar said an exclusive meeting on services with the EU has been scheduled in 10 days.
The India-EU bilateral agreement would include goods and services as well as investments. Efforts are being made to conclude the talks by the year-end.
On the WTO negotiations, Mr Khullar said services were important for the Indian economy and negotiations in this area had remained a non-starter. “In the Doha round, services negotiations have not really taken off due to the logjam on agriculture and industrial goods. Until the logjam on agriculture and non-agricultural market access ends, nobody will talk on other things,” he said.
It was ironical that areas like agriculture in which there was not much to be gained were holding up progress in talks at WTO, Mr Khullar said. Global trade in services stands at $3 trillion, of which India accounts for $80 billion.
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According to World Bank chief economist Aaditya Mattoo, services negotiations at the WTO offer India a golden opportunity to secure access to foreign markets and to spur domestic reforms. Moreover, India, through its visionary leadership, can transform the Doha services negotiations by proposing a package that is balanced, commercially-relevant and supports development,” Mr Mattoo said.
The handbook pointed out that a promise not to impose new restrictions on trade in services would dispel the spectre of protectionism that hangs over outsourcing of business services. A credible promise to eliminate barriers to FDI, either immediately or gradually, where regulatory inadequacies need remedies was required for complementary reforms, the publication added.
Another important ingredient of a successful services package would be an agreement to allow greater freedom of international movement for individual service providers in order to fulfil specific services contracts, the handbook advised.
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