In The Media ⁽⁴⁰⁰⁾

What does WTO really do to be decried as the "World Terrorist Organization" by a rally supported by three former Prime Ministers of India? Economic Times, October 22, 2004 Immediately preceding the Cancun conference, three former prime ministers—H.D. Deve Gowda, I.K. Gujral and V.P. Singh—lent their support to a rally decrying WTO as the World Terrorist Organization. Deve Gowda and Gujral had served as prime ministers after the birth of WTO on January 1, 1995 and therefore had the opportunity to withdraw from it. They did no such thing perhaps because they knew that India benefited hugely from the membership. But now that they are in the opposition, they must not feel the same responsibility any longer. That WTO is beneficial should be obvious from the fact that as many as 148 countries are its members today. China made very substantial concessions to join it two years ago and Russia is waiting in the queue. While new members have steadily been added, few have exited the institution. Why member governments nearly universally view WTO as beneficial can be best appreciated by understanding what it does.

India's role in the WTO negotiations has turned less negative but it has some ways to go.Apropos of “If this is success, what will be failure?” by Arvind Panagariya (ET, September 24) the standard theory of Nash bargaining says that it is not fairness, but the selfishness of players that ultimately guides negotiations. Read full article Abstract: Apropos of "If this is success, what will be failure?" by Arvind Panagariya (ET, September 24) the standard theory of Nash bargaining says that it is not fairness, but the selfishness of players that ultimately guides negotiations. That was very evident in US positions when it backtracked from the Doha meet held during Clinton's presidency. The US national agenda then did not include assistance to farmers, but the Bush administration wants that. As for India, it is untrue that we succeeded at Cancun just on the strength of non-cooperation with the OECD nations. Our economy is inefficient, markets incomplete, and we had nothing to offer — other than strident negotiating positions! Developed economies lobbied by saying they were protecting their "transparent" economies, but we just…

Read full article (September 16, 2003) Abstract: Just prior to the Cancun WTO Ministerial, a compromise on access to medicines for poor countries had raised hopes that the Developed and the Developing could resolve their differences after all -- and that the Doha Round might actually move forward. But the talks at Cancun have collapsed and the opportunity is lost. The collapse was in no small measure due to the unwillingness of developing countries to make credible market-opening concessions of their own, to match those they demanded from the rich countries. This is tragic since such liberalization would have only benefited them -- and helped open the markets of their partners. Of course, Cancun is no Seattle. At Seattle, the WTO members tried and failed to launch a new round whereas at Cancun they have failed to move an ongoing round forward. The more apt analogy is with the failure in Montreal in 1988 when developed and developing countries had failed to advance the Uruguay Round. The round was, however, successfully completed in 1993. Ironically, differences between rich and poor countries on…

When NGOs operatre in their areas of expertise, they can force important policy debates and policy changes in democratic countries in not just developed but also developing countries. Here is a beautiful example from India. Economic Times, August 27, 2003 The ongoing cola controversy offers a fascinating example of a responsible non-governmental organisation (NGO) advancing the cause of public policy in a globalising, democratic, developing country. Begin by considering the broad facts. On August 5, 2003, the New Delhi-based NGO, Centre for Science and Environment (CSE), announced that according to its tests, 12 colas produced by multinationals Coke and Pepsi contained pesticide residues 11 to 70 times as high as the norms prevailing in the European Union (EU). CSE explicitly acknowledged that the colas adhered to the local, Indian norms but argued that the multinationals practised double standard, selling less clean cola in India than in the EU and US. The reaction to the CSE announcement was swift, with three states banning the colas and Parliament banishing them from its cafeterias. CEOs of Coke and Pepsi rushed to the defence…

Given India's success in achieving macroeconomic stability during the last half century, it is ironic that the study of macroeconomics in India has lagged far behind that of microeconomics. For this reason alone, the recent volume Macroeconomics and Monetary Policy: Issues for a Reforming Economy, edited by M. S. Ahluwalia, Y. V. Reddy and S. S. Tarapore, honoring Chakravarti Rangarajan, the first academic economist to serve as the Governor of the Reserve Bank of India and a much-admired figure among Indian economists and policy makers, is a useful addition to literature on economic reforms in India. July 30, 2003 With the combined central and state fiscal deficits having hit the double-digit levels, the question whether another macroeconomic crisis is around the corner has assumed renewed salience. In an important paper in a recently published volume, Macroeconomics and Monetary Policy: Issues for a Reforming Economy, edited by Montek S Ahluwalia, Y V Reddy and S S Tarapore, Ahluwalia offers a careful dissection of this question. He concludes that though poor fiscal performance and incomplete reforms of the banking sector are sources…