14th Ministerial Conference of the World Trade Organization

Syllabus: GS3/ Economy

Context

• The 14th Ministerial Conference (MC14) of the World Trade Organization concluded in Yaoundé without consensus on extending the e-commerce duty moratorium.

What is the E-commerce Moratorium?

• WTO members agreed in 1998 not to impose customs duties on electronic transmissions, which include:
  • Digital goods such as e-books, software, music, and video games.
  • Services delivered electronically such as streaming platforms.
• The moratorium has been renewed biennially at successive Ministerial Conferences. Its expiry on March 31, 2026 allows countries to impose tariffs on digital trade.

Key Issues at Ministerial Conference (MC14)

• Lack of Consensus on Extension: Developed countries such as the U.S., EU, and Japan supported a long-term or permanent extension.
  • Developing countries, including India, opposed the extension due to concerns over revenue loss and reduced policy space in the digital economy.
  • Disagreement over duration (2 years vs. 5 years) led to a negotiation deadlock.
• TRIPS Non-Violation Moratorium: It led to the expiry of the safeguard against non-violation complaints under the TRIPS Agreement,
  • The safeguard since 1995 has protected the policy space of developing countries. Without it, even WTO-compliant measures, such as compulsory licensing, can be challenged by developed countries.
  • For India, this increases the risk of disputes over Section 3(d) of the Indian Patents Act, 1970, which restricts patents for already-known drugs unless the new claims are superior in terms of efficacy. It curbs the evergreening of patents.
• Fisheries Subsidies: Members celebrated the entry into force of the 2022 Agreement on Fisheries Subsidies, which bans support to illegal fishing, to the fishing of already depleted stocks without efforts to restore them, and to unregulated fishing on the high seas.
  • However the agreement does not cover subsidies causing overcapacity and overfishing.
  • The members agreed to continue negotiations on fisheries subsidies to address unresolved issues at the 15th Ministerial Conference.

Core Principles Advocated by India

• Development-Centric Multilateralism: India stressed the importance of an open trading system and reiterated the principle of non-discrimination, as embedded in the Marrakesh Agreement.
• Public Stockholding (PSH) for Food Security: India demanded a permanent solution on Public Stockholding (PSH). It argued that:
  • A large proportion of Indian farmers are small and resource-constrained.
  • The Minimum Support Price (MSP) system is essential for ensuring income security.
• Special and Differential Treatment (S&DT): India emphasised the need for effective Special and Differential Treatment provisions for developing countries and Least Developed Countries (LDCs) to address structural inequalities in global trade.
• Dispute Settlement Mechanism: India stressed the need to restore a fully functional, automatic, and binding dispute settlement system.
  • The current paralysis of the Appellate Body undermines the credibility of the WTO.

Source: TH