Keep MSME and Gender Issues Apart from WTO Rules

Source: This post has been created based on the article “Keep MSME and gender issues apart from WTO rules” published in “Live Mint” on 7^th February 2024.

UPSC Syllabus Topic: GS Paper 2 International Relations – Important International institutions, agencies and fora- their structure, mandate.

News: The article discusses the need to keep MSME and gender-related issues outside WTO rules. Keep MSME and Gender Issues Apart from WTO Rules

Background:

The 13th Ministerial Conference of the World Trade Organization (WTO) to be held his month will discuss how the WTO can become more relevant for micro, small and medium enterprises (MSMEs) and businesses run by women.

Informal working groups on both MSMEs and gender were launched at the 11th ministerial in 2017.

What has been India’s Stand?

India has stayed out of both groups because:

1) Beyond WTO’s Jurisdiction: These issues are not part of the WTO’s mandate (non-trade nature of those two subjects).

2) Distracts from Important Issues: WTO members should instead focus on unfinished matters that impact food security and trade in services and goods.

Why is a Focus on MSME’s and Gender Needed?

According to UNCTAD, international trade has only resulted in a “world of unchecked monopoly power, financial speculation, booms and busts, and rising inequality.”

International trade should ensure benefits for all sections of society within each trading country, not just large corporations.

What has India Done in This Regard?

India’s 2023 Foreign Trade Policy had three features in this regard:

(a) a district export action plan in each district of India to identify and incentivize products for export;

(b) the promotion of e-commerce through ‘Dak Ghar Niryat Kendras’ to enable artisans, weavers, craftsmen and MSMEs in the hinterland and land-locked regions to reach international markets;

(c) trade facilitation for MSMEs, including lower charges for various schemes, preferential customs treatment and quick dispute resolution.

What have been Global Initiatives in This Regard?

1) Global Trade Helpdesk launched by ITC, UNCTAD and WTO— an online platform that simplifies market research—is a useful resource for MSMEs.

2) WTO’s Technical Assistance Plan for 2018-19 incorporated a module on trade and gender, whose objective was to focus on trade policy to raise awareness and enhance the aptitude of policymakers to incorporate gender considerations.

3) G20 New Delhi Declaration focused on the need to address access to information for MSMEs, advancing financial inclusion and implementing gender-responsive policies to enable inclusive integration in international trade.

What are The Challenges?

1. One-size-fits all response may not work: The reason is: What is an MSME differs from country-to-country. Hence, preferential treatment for an MSME in India cannot be extended to an MSME as per the definition of another country seeking Indian market access.
2. Global rules may not work in a domestic setting: Addressing gender imbalances in access to economic opportunities, such as preferential access to credit, is an issue that needs to be addressed within a country. The global rules of trade have little role here.

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What Should be The Way Forward?

1) Sharing of experiences and best practices could be helpful.

2) The WTO can also consider workshops and virtual platforms for sharing information.

3) Issues affecting MSMEs and women in trade should be best addressed by each country within the context of its economic realities and legal frameworks.

Question for practice:

Why should issues related to MSMEs and gender-related issues be kept outside WTO rules? What have been India’s and Global initiatives in this regard?