Why India is opposing China-led WTO deal, despite isolation risk, Pg15

Key Highlights:

• The Investment Facilitation for Development (IFD) Agreement, backed by China at the World Trade Organization (WTO), has garnered support from 128 of 166 member countries.
• India and South Africa are opposing the IFD, citing concerns over multilateralism and the potential marginalization of developing nations.
• WTO Director-General Ngozi Okonjo-Iweala supports the IFD, emphasizing its potential to enhance transparency and attract investment.
• A report by the Research and Information System for Developing Countries (RIS) highlights the overlap between IFD participants and China's Belt and Road Initiative (BRI).

Detailed Insights:

• The IFD aims to improve the investment climate and promote Foreign Direct Investment (FDI), particularly in developing and least developed countries, to foster sustainable development.
• India argues that incorporating the IFD through a plurilateral route undermines the WTO's foundational principle of multilateralism and consensus-based decision-making.
• Plurilateral deals, which apply only to participating countries, could lead to a two-tiered WTO dominated by major economies, potentially sidelining issues important to developing nations like farm subsidies.
• Proponents of the IFD claim it excludes contentious issues like market access, investment protection, and investor-State dispute settlement, and includes provisions for Special and Differential Treatment for developing and least-developed countries.
• The RIS report suggests that the IFD could complement China's geo-economic strategies by standardizing regulatory procedures and strengthening the operational environment for large-scale cross-border infrastructure and investment networks under the BRI.
• India's opposition to the IFD may be a tactical move to push for a permanent solution on the public stockholding of food grain, a long-pending issue since the Bali Ministerial Conference.

Key Concepts Involved:

• Multilateralism: A system where major decisions are taken collectively by all members, each having an equal voice.
• Plurilateral Agreement: Trade agreements between a subset of WTO members, not involving all members.
• Foreign Direct Investment (FDI): An investment made by a firm or individual in one country into business interests located in another country.
• Belt and Road Initiative (BRI): A global infrastructure development strategy adopted by the Chinese government.