India must institutionalise approach to trade negotiations

As India takes its place as the fastest growing economy within the global economic order, it is about time the government looked at appointing a dedicated “Indian Trade Representative”, argues India Inc. CEO.

Does India need a dedicated office of a Trade Representative (TR) akin to the United States Trade Representative (USTR) India has ongoing bilateral and multilateral trade negotiations with the European Union, Thailand, Asean and the Gulf Cooperation Council, among more than a dozen countries and blocs. Then, it has, at last count, at least 45 trade disputes with its trading partners pending before the World Trade Organisation (WTO). In addition, Indian industry is being buffeted by the dumping of steel, chemicals, electrical and electronic products, among others, by Chinese companies.

There can be no two opinions on whether India needs a specialised office manned by experts to deal with the varied and often complex nature of the negotiations/cases. This is not to suggest even for a moment that the Union commerce ministry, which currently handles all these functions, has not been doing a good job of discharging its duties. It is just that the remit of the ministry is too vast and that the minutiae of trade negotiations and dumping cases is best handled by specialists.

If the government does appoint an “Indian Trade Representative (ITR)”, it won't be the first time an NDA government led by a BJP Prime Minister will have taken such a bold step.

Cut to November 1998. Then Prime Minister Atal Bihari Vajpayee surprised everyone by appointing former Indian Foreign Service (IFS) officer Brajesh Mishra as India's first National Security Advisor (NSA). In the tradition-bound world of the Indian bureaucracy and governance, where precedence is always cited as a guide to the future, the creation of this new and very powerful position was nothing short of revolutionary.

Change-resistant politicians, mandarins and sections of the commentariat immediately began dissecting the fine print of the new position. Many of them said the NSA would undermine the position of the foreign minister and the ministry of external affairs. Others said it would curtail the space of the home minister and ministry of home affairs. Both these arguments were technically correct. But technical arguments have seldom been able to stop ideas whose time has come. With economic growth, India's stakes in its immediate neighbourhood as well as around the world had increased manifold and an NSA reporting directly to the Prime Minister had become a crying need of the hour.

The outcry against the creation of this new position was short-lived and the NSA has become a very visible office bearer of the Indian government. The Congress-led UPA government, which pointedly turned the clock back on several decisions of the NDA government, also retained the position throughout its 10-year tenure in office.

What will the ITR do Let us look at the remit of the US counterpart. The USTR's job is to “identify those foreign countries that deny adequate and effective protection of intellectual property rights, or deny fair and equitable markets access to United States persons that rely upon intellectual property protection, and those foreign countries identified under” this “paragraph that are determined by the Trade Representative to be priority foreign countries”.

The (USTR) Act defines “priority foreign countries” as “those foreign countries that have the most onerous or egregious acts, policies, or practices that deny adequate and effective intellectual property rights, or deny fair and equitable market access to United States persons that rely upon intellectual property protection, whose acts, policies, or practices described in” this “paragraph have the greatest adverse impact (actual or potential) on the relevant United States products, and that are not entering into good faith negotiations, or making significant progress in bilateral or multilateral negotiations to provide adequate and effective protection of intellectual property rights.”

That is as good a template as any to base an ITR's key result areas on. Commerce ministry bureaucrats have done a wonderful job so far upholding India's interests at bilateral and multilateral trade fora and safeguarding the markets of Indian companies facing dumping from foreign companies.

But even the most committed supporters of these efforts will agree that Indian bureaucrats are generalists, hopping from department to department. But in today's highly competitive, cut-throat world, it is time to accept that India needs specialists as trade negotiators, especially as most of our trade partners and competitors appoint such domain experts to push their points of view.

Then, the office of the ITR will also be the one-stop repository of institutional knowledge, experience and memory. This can be invaluable to future office bearers. Currently, the experience of individual bureaucrats is often not available to the government when that individual moves to another department or retires. A dedicated ITR will ensure that does not happen. Details like who the ITR will report to, the precise remit of his mandate and the division of labour between the new office and the ministry of commerce can be worked out by experts. But the short point is: An Indian Trade Representative is an idea whose time has clearly come.