Author(s): S. R. Sen
Source: Economic and Political Weekly, Vol. 29, No. 43 (Oct. 22, 1994), pp. 2802-2804
Published by: Economic and Political Weekly
Stable URL: http://www.jstor.org/stable/4401936
Accessed: 02/02/2010 02:57
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PERSPECTIVES
should no longer be contined onily to tarilf
From GATT to WTO andtradeingoodsbutshouldblealsoextende(d
to services. inivestment and intiellectual
S I? Sen propertyrights and that thlrecshould be a
WT() (WorklTradeOrganiisatin) toovwersee
I I;i1\V evelopinig conllflries, which were not satisfied with the Tokyo all these four. Wheni tlih_var-iOusallrgumelnts
against such a frcmOricd
for and;l CATT (or
Rilid oJ/GATT,hladhoped thai thlrouigh thleUruguayRoundc anendmenis WTO) was placeL Oilthle tale and sonic
theXniighlthe able to control thlerogue elephant,the US, willi its arbitr(ry) compromise seemed possible. the then
Arlicle 301 oJ its TriadeAct. But now it appears thlatiflste(Id
(lctions undit1er directorgeneral ot'GAT'l)unkcl put f'orwar-d
(4 coniending witli one roguteelephant they will have to contend witli a a dralt documenitof his own. known as
Dunkelproposals.With somemoditications.
numberof grasping octopusesin the shape of the tranisnational these proposals were accepted hy atllthe
corporaitions(TNCs). members of thlcGATT in Decemberh1993
at the official level and in Mar-ch1994 at
IN 1944. nearthe etndof World War II. thle opposedby the US andsomeotherimportant the ministerial level. Bult about a-w doien
Brettoni Woodls Conft'eence ma(le recom- countiies (called the G-7: GIioup countries.includfing
tdevclope(d thlcLiS aindlIatil. whilC
mcndatiolnsto set up tilree interilational of 7 devcloped countries). At the outset signing the I)raft Agrecmcentput in the
oirganisations:(i) IMF (InternationalMon- several (levelopedlcountries specially the res'ervation that tlie' would lnotr-illfVit tilitil
ctlrvyFundl)to deal witlhbalance ol'payments Scandinavian countries wcrc vcr'y theirrespective: legislaturesaJ)pprovcdit. The
problems. (ii) World Banik (International svmpathietic to G-77. But some ol hlie WTo and its ancillariy aglccincits. c ,
Bankfr Reconstruction ain I)evelopment) extremistpositionstkckiby theG-77 pre.ssed( ievisc(l GA1T (rcgardinLgtaln11s an1d tr-ade
to deal withitheproblemisof reconstruetion by some inexpericicd leadlersof newly ahout goods inc luding ag,ricultural
ind(Iecvelopincnt.aindi countries made these liberal commodities). GATS (regarding services),
(iii) ITO(Internation- idepen(lepnent
al Trade Oreganisation) to deal with piroh- developed countries to sidlewitlhG-7. TRIMS (regarding inve.stm1ent)and TRIPS
lcms of intcirnationaltradle.The first two Nevertheless. the pressureof G-77 nmade (regarding intellectua-l1 prope-ty rights) ancl
wcre sct up)in 1945 but there were serious theUNCTAI) gain in statureanidatonc time a provision for cross rctaliation hetwccn
controversiessahoutthe third.Thereforethe it appeare(das it it mightreplace the CATT. sectors f'or violation of the prescribed
UiS.UK a;nd( a few other countries set up in But the US strongly supportedthe GATT conditionalities are scheduledlto comc into
1947 an interim organisation about trade and(it conitiniucito be powerful. However. effect on .anuary 1, 1995 with agracepciiid
nalmedGATT (General1Agreementon Tariff' sustailinedpressure of' G-77 maide GATT of one year f (!r the least lcvcloppedcotici\it s
andTrade).In(liawas a foundermembcrof progressively more liberal and ilheTokyo Jn theory tlhis vill happen evenl it somec
all the threc. A few year.slater, the Havana Roundof the GATT gave a very important counitr-ics iniclu(dinig thle US whiichi lhad
Conferencerecommendedthe setting up of concess-ion to the developing countries, registered their reservatioi (lo nrotratlfy by
ITO with the supportof the US administra- namely, GSTP (GeneralScheme for Trade that (late. But the US is such an important
tion. But the US Congress refuse(dto ratify Preferences). country and a super power both politically
it. Thcrefore, the ITO could not be s-etup But neithle 0-77 nor 0-7 were content anIieconomincallythat if it dloes not ratity,
and the GATT was continued. All the thlree with this. Both lstarted pressing for further the WTO may hc still born now aiswas the
organisationsC were donminate'dby the US. ameniment of the GATT. ITO four deca(les earlier.The US adminis-
The GATT, in particular. was biased in tration is iying hardlto mobil ise support for
favour of the developed countries and was URITGUANYRoITNI) the WTO in the US Congrelss but therc is
calledlinformally as the "richmen isclub". some diff iculty because mIalny of the
The Uruguay Rounid of discussions with Congressmen d1o not waint to give up Article
UNCTAI) this purposcwas startedin 1986. The G-77 301 in the US Trade Act andlthesovereignty
maintainiedits united pressure for a few of the US Congiress in trade maitte:rs.
It is
The developing countries strongly years but the US exploited the differences expected that the US Congress will (lecidle
protested against the bias of the GA1T betweendifferentsection. of G-77 countries, one way or the other by l)ccember 1994.
favourinig the developedl countries and oil producing.newly
Cg. exporters.importers, InIndlia.ainotherimportantcountrv.there
demandeedthat an ITO be set up. The UN countries.etc, to breakup the
ind(ustrialisetd is strong objcction to WTo in its present
appointeda committee in 1963 to consider unity of G-77. In this it used cleverly the form.The governmentis campaigninigvery
how best this could be done bec.ausethe US Super and Special Article 301 of US Trade hardfor mobilising support in parliamelnt.
Congress was still likely to veto any new Act and various. (liplomatic, financial and Althoughl it hals requisite supportl in the ILok
proposal for ITO. Thils UN Committee other pressures.Till 1989. the core Group Sabha, it has problems in thleRajyaSabiha.
recommendedas a possible alternativc(as of C-77 led by India and Brazil was The basic issue in Inidiais the samc as in
suggested by the pr-esentwriter, who was a functioning quite effectively but in 1989 the US, namely. the soveireiginpower ol the
member) a via media. UNCTAD (United India accepted unilaterally somp of the parliament (or the Congress). Many of the
NatioinsConferenceon TradeandDevelop- proposals of the US. The result was that IndianMPs feel that the Tokyo Roundwas
ment), to be set up as a part of the UN India was isolated and the erstwhile better for the developing countries andithe
Secretariatto a'voidbeing subjectto veto by supporters of India made their own Uruguay Round was a great surrender to the
US Congress. The UJNCTAI)was set up in compromises with the US. developed countriies. The conditionalities
1964 on the basis of this alternative.Durinlg The emergence of US as the single super that the new GATT-94 (tiat is WTO) will
the negotiations for setting up UNCTAD. power after the hreak up of USSR greatly impose upoin lndia's policies icgar.Iding
the developing countries establislhe(ean increasedlits clout. With prompting and agricultureandlintellectual propeirtyrighlts
G-77 (Groupof 77 developing
organiisatioin. strong support from TNCs (tranisnational in particular and the novel provision of cross-
countries), which was later joined by most corporations).whichgot speciallyinterested retaliatioin betwecn quitc unreclatectsectors
ot the developiingcountries.This G-77 was at this juncture. US pressed that GATT like goodls.services. investmentandipatent