[Answered] What are the key areas of reform if the WTO has to survive in the present context of ‘Trade War’, especially keeping in mind the interest of India?

Introduction

Economic Survey 2025-26 flags dysfunctional WTO amid escalating trade wars and unilateral tariffs; Budget 2026-27 prioritises strategic autonomy; NITI Aayog’s Trade Strategy 2030 warns that reforms are essential to protect India’s developmental space and energy security from protectionist surges.

India’s Strategic Imperatives

1. The WTO was established to promote rules-based global trade, transparency and dispute resolution. However, the rise of protectionism, geopolitical rivalry and unilateral tariffs has weakened the multilateral trading system.
2. Trade wars, technological competition and industrial subsidies now dominate global economic relations. For the WTO to remain relevant, structural reforms are necessary—particularly from the perspective of developing economies like India that seek policy space for growth and development.

Key Areas of WTO Reform for Survival

For the WTO to survive the current Trade War era, it must transition toward Adaptive Multilateralism. India’s interests lie in ensuring that the rules-based order protects developmental space rather than enabling Green Protectionism.

1. Restoration of the Dispute Settlement Mechanism (DSM): The DSM, once the crown jewel of the WTO, remains paralysed since 2019 due to the US blockade of Appellate Body appointments. India requires a binding, time-bound two-tier system with impartial adjudication to challenge unilateral tariffs (US steel duties) and green taxes such as the EU’s CBAM. Without restoration, developing countries lose the only multilateral enforcement tool against power asymmetry.
2. Redefining Agricultural Subsidies under Agreement on Agriculture (AoA) Current De Minimis limits (based on outdated 1986-88 reference prices) constrain India’s food-security programmes. A permanent solution for Public Stockholding (PSH) and an effective Special Safeguard Mechanism (SSM) are non-negotiable to shield 150 million farmers from import surges during global price volatility. Failure here directly threatens India’s right to food security under Article 21.
3. Disciplining New Issues and Plurilaterals The e-Commerce moratorium on customs duties costs developing nations billions in revenue; India must oppose its permanent extension. Similarly, the China-led Investment Facilitation for Development (IFD) agreement must not be imported into the WTO framework without consensus, as it erodes the single-undertaking principle and limits policy space for industrial strategy.

Integrating Energy Security with India’s Foreign Policy

Energy security has become a central element of India’s strategic diplomacy.

1. Diversification of Energy Partnerships: India imports a significant portion of its energy requirements. Strategic partnerships with major energy producers ensure reliable supply chains. Diversification reduces vulnerability to geopolitical disruptions.
2. Leadership in Renewable Energy Diplomacy: India has emerged as a key player in global clean-energy cooperation. Initiatives like the International Solar Alliance demonstrate India’s leadership in sustainable energy governance. Renewable energy partnerships strengthen diplomatic engagement with developing countries.
3. Strategic Autonomy in Energy Trade: India’s foreign policy increasingly emphasises strategic autonomy. Balanced relations with major global powers allow India to secure energy supplies without geopolitical alignment. Energy diplomacy thus supports both economic stability and national security.

Integrating Energy Security with Foreign Policy

Energy security has shifted from a commercial import to the dominant kingpin of India’s 2026 foreign policy.

1. From Hydrocarbon to Electron Diplomacy: India is leveraging the International Solar Alliance (ISA) and the Global Biofuels Alliance (GBA) to lead the Global South. Foreign policy trajectory now focuses on securing Critical Mineral Supply Chains (Lithium/Cobalt) through the Mineral Security Partnership (MSP), reducing dependency on dominant suppliers like China.
2. West Asia: Strategic Reciprocity: Investment for oil storage and moving from buyer-seller roles to joint ventures in India’s Strategic Petroleum Reserves (SPR). Using the India-Middle East-Europe Economic Corridor as a Green Energy Link, potentially exporting Indian-made Green Hydrogen to Europe via the Gulf.
3. Energy as a Peace Architect: India’s Strategic Autonomy allows it to manage energy ties with Russia (discounted crude) while deepening high-tech energy cooperation with the US (iCET initiative), ensuring that energy needs are not weaponized by big-power rivalries.

Way Forward

1. Lead a Global South coalition at the next Ministerial Conference for DSM restoration within 18 months.
2. Secure permanent PSH and SSM solutions while linking them to energy-subsidy safeguards.
3. Oppose plurilateral back-door entry and advocate adaptive multilateralism through G20/BRICS coordination.
4. Embed energy-security clauses in all ongoing FTAs and use public procurement to de-risk domestic green-tech manufacturing.

Conclusion

Economic sovereignty is the foundation of national dignity. Like S. Jaishankar’s The India Way, true self-reliance is earned by navigating global storms with firm strategic intent.