India’s Stance on Expanding the WTO’s Agenda and Its Impacts

Source: The post India’s stance on expanding the WTO’s agenda and its impacts has been created, based on the article “Why India needs to reset its trade policy” published in “Indian express” on 9th July 2024

UPSC Syllabus Topic: GS Paper3- Economy

Context: The article discusses India’s resistance to expand the WTO’s agenda, highlighting the need to balance policy flexibility for traditional sectors with opportunities in new fields. It emphasizes India’s evolving economic strategies, regulatory reforms, and the importance of proactive engagement in WTO negotiations.

For detailed information on WTO Reforms and India read this article here

What Are India’s Export Goals?

1. Increase Goods Exports: India aims to increase its goods exports to $1 trillion by 2030.
2. E-commerce Market Growth: The e-commerce market in India is expected to surge to $350 billion by 2030. Currently, e-commerce routed exports are only 1% of total exports, amounting to $3.0-3.5 billion. This is projected to grow, taking advantage of global e-commerce exports predicted to reach $2 trillion by 2030.
3. Improve Trade-to-GDP Ratio: India aims for a higher trade-to-GDP ratio, ideally between 30-35%, to support economic growth and meet export targets.

What is India’s Stance on Expanding the WTO’s Agenda?

Resistance to Expansion: India resists the expansion of the World Trade Organization’s (WTO) agenda in new domains such as e-commerce, trade, climate change, and investment facilitation.

Policy Flexibility: The main reason for this resistance is to preserve policy flexibility that supports India’s economic development strategies.

What are its impacts?

1. Protection of Traditional Sectors: India’s stance helps safeguard vital sectors like agriculture and fisheries, ensuring policy flexibility for economic development.
2. Limitation on New Opportunities: The resistance may hinder India’s ability to capitalize on emerging fields such as digital economy and high-tech manufacturing.
3. Impact on Global Stature: India’s hesitancy in expanding the WTO’s agenda may affect its ability to influence global economic governance and integrate fully into changing international markets.

What Is India’s Domestic Policy Reforms?

1. Promotion of Technology-Driven Growth: India’s reforms aim to foster a digital and high-tech economy, aligning with the Vikas Bharat vision of becoming a developed nation by 2047.
2. Environmental Sustainability: The country is committed to a low-carbon transition, aiming for net-zero carbon emissions by 2070, while improving energy access and reducing greenhouse emissions.
3. Regulatory Reforms in E-commerce: These reforms promote digitization, transparency, and operational efficiency, encompassing data protection, consumer rights, competition, and taxation to support the growth of e-commerce, projected to reach $350 billion by 2030.
4. Enhancing Global Integration: Policies are designed to make India a favorable destination for foreign direct investment, which was the third highest globally in 2022.

Question for practice:

Examine how India’s resistance to expanding the WTO’s agenda impacts its traditional sectors and opportunities in emerging fields.