Putting plurilaterals to good use: India signals change in WTO stance by engaging in plurilateral agreement discussions after BRICS declaration

Following last month’s BRICS New Delhi Declaration, India submitted a paper to WTO signaling a willingness to engage in discussions on plurilateral—'coalition of the willing’—agreements. Until now, New Delhi maintained a rigid stance, refusing to negotiate, or even discuss plurilaterals on the grounds that it lacked an explicit mandate to initiate them. Instead, India relied heavily on the letter and spirit of consensus-based decision-making at WTO to assert its legal position.

Reactions to India’s submission have been mixed. International partners have been largely sceptical. Optimists view it as a vital opening for constructive dialogue. Pessimists contend that the submission merely repackages New Delhi’s long-standing opposition, serving as a tactical ploy to scuttle progress by insisting on consensus before any discussion can begin.

Currently, India is not a participant in any ongoing plurilateral negotiations within WTO. More critically, it has blocked the formal adoption of key outcomes—like the Investment Facilitation for Development (IFD) agreement, and Joint Statement Initiative on e-commerce—into the WTO’s legal framework. India is under no obligation to join these agreements as a member. So it doesn’t take on new obligations.

But it faces mounting international pressure—including from developing and least developed countries—to lift its veto against their formalisation, an act that requires consensus across the entire membership.

To move from obstruction to leadership, India must adopt a constructive stance that protects the multilateral core of the trading system, while enabling modern rulemaking. Plurilateral pathways to multilateralisation are not inherently foreign to WTO. During the GATT Tokyo Round, 7 plurilateral agreements were negotiated, 5 of which were successfully multilateralised during the Uruguay Round that birthed the WTO in 1995.

More recently, plurilateral frameworks like Information Technology Agreements (ITA I & II), Financial Services Understanding, and rules on GATS Domestic Regulation were integrated into WTO using specific legal safeguards. To ensure that plurilateral initiatives serve as a pathway to multilateral outcomes, India should insist that they be grounded in Most-Favoured Nation (MFN) application and open participation. This would allow India to benefit from such initiatives without relinquishing any of its existing rights under WTO agreements.

The key challenge is whether WTO members, particularly those participating in these initiatives, are prepared to embrace these principles as a shared framework, and if so, under what conditions.

• Standard guardrails of MFN application, coupled with open plurilateralism, are entirely feasible for agreements covering regulatory disciplines like IFD. Because regulatory commitments are applied uniformly through a host country’s domestic legal system, non-participants automatically benefit on an MFN basis without assuming new obligations or surrendering existing rights.

Also, open plurilateralism guarantees that non-participants can join at any time under the same conditions as original signatories. Because regulatory harmonisation naturally diffuses across markets, ‘free-riding’ by non-participants is generally not an overwhelming concern for signatories.

• Agreements involving market access concessions must address the issue of free-riding head-on. Participants strongly object to offering commercial concessions to non-signatories who offer nothing in return. Here, core guardrails of MFN and open participation must be augmented by a substantial participation threshold. By requiring that participating countries represent a critical mass (typically a defined percentage of global trade in the targeted sector), the threat of free-riding is minimised.

India can demonstrate true leadership by proposing clear, dedicated legal homes within the WTO architecture for these distinct agreement types:

1. Schedules of commitments For domains where the WTO legal architecture already provides scheduling options under GATT/GATS, plurilateral commitments can be accommodated within each member’s individual schedules.
2. Standalone legal housing Legalising open plurilateral, regulatory agreements that bear no direct relationship to existing WTO agreements poses a distinct structural challenge. WTO currently lacks an appropriate legal housing for standalone, MFN-based regulatory agreements.

Annex 4 of WTO Agreement is reserved exclusively for agreements where both rights and obligations are restricted solely to signatories. Housing an MFN-based agreement in Annex-4 creates a direct legal contradiction. To resolve this, India could engage constructively on suggestions made by experts, like creating a new Annex 5—specifically designed to house regulatory plurilaterals implemented on an MFN basis.

By championing objective legal distinctions, India can enable viable plurilateral pathways without compromising the integrity of global trade governance.

(Hoda is former deputy DG, WTO. Aggarwal is chairman, CUTS International, Geneva. Mehta is secretary general, CUTS International)