Policy Papers ⁽³⁶⁾

Read paper (Forthcoming in a volume to be published by the Center for Global Development). I examine the scope for and desirability of the U.S. assistance to the poor countries through three separate trade policy measures: one-way trade preferences as, for example, under the Generalized System of Preferences; bilateral trade preferences as under free trade area arrangements as under the U.S.-Jordan Free Trade Agreement; and multilateral trade liberalization as under the Uruguay Round Agreement. My principal conclusion is that of these three forms of market access, only the last one is both desirable and feasible. I also argue that further opening of developed country markets, no matter what form it takes, can help the poor countries only in a limited way. Despite all the rhetoric and assertions to the contrary, the bitter and sad truth is that even if developed countries were to open their markets fully without asking for reciprocal liberalization and without any side conditions, few poor countries will succeed in achieving significant growth and poverty reduction purely as a consequence of this opening up. The explanation for…

Read paper (Forthcoming in a guide for negotiations for developing countries edited by Bernard Hoekman): The paper outlines various approaches to reciprocal reductions in tariffs and and their relative merits. If the objective is to achieve maximum liberalization worldwide, an across-the-board approach that lowers higher tariffs more such as that based on the Swiss formula would be the right choice. The across-the-board approach minimizes the room for successful lobbying by political powerful sectors, which often happen to be the most protected sectors in the first place. Moreover, a formula that lowers high tariffs more reduces the dispersion in tariffs and hence effective protection in all sectors. A formula approach also has the advantage that it does not tie up negotiating resource in a major way as do sector-by-sector negotiations.

Read paper (Forthcoming: World Economy, 2003) This paper systematically analyzes the issue of trade liberalization in South Asia region and offers a qualitative assessment of alternative approaches. I compare two broad approaches to trade liberalization: nondiscriminatory and preferential. The former approach can be pursued on a unilateral basis by each country in the region, on a concerted basis by the countries in the region, or multilateral basis under the auspices of the WTO. The latter approach can take the form of crisscrossing bilateral free trade areas between various countries in the region or a region-wide free trade area. The view I take in the paper is that the move towards preferential trading is a mistake, at least from the viewpoint of India. India continues to have very high trade barriers so that the scope for trade diversion and the losses accompanying it are likely to be considerable. Business lobbies being relatively powerful in most of the countries in the region, they are likely to exploit the rules of origin and sectoral exceptions in these arrangements in ways that will maximize…

Read paper (In Drabek, Zdenek, Globalization under Threat, Cheltenham, U.K.: Edward Elgar 101-123). The demand for a WTO working party on labour standards by the US at Seattle returned the contentious issue of the link between trade and labour standards to the center stage of multilateral trade negotiations. This paper offers a detailed and systematic analysis of the subject. I begin first by dissecting the intellectual case for the link. I then describe the so-called 'core' ILO Conventions. In section 4, I identify the sources of pressures for higher labour standards that led to the failure in Seattle as also the pressure being exerted within the current system on some developing countries to raise labour standards to preserve their privileges under the Generalized System of Preferences.

Read paper (World Economy, Vol. 25, No. 9, September 2002, pp. 1205-33) The paper offers a comprehensive analysis of what developing countries accomplished and failed to accomplish and why. Among the questions addressed are: Did developing countries get shortchanged in the Uruguay Round and if yes in what way? Does the Doha outcome reverse this? Is the success in the area of intellectual property rights truly as major as has been made out in the media? Why do so many developing countries oppose the Singapore issues? Why do developing countries have very limited bargaining power? How can they improve upon it? And what are the implications of China joining the WTO?