G-4 trade talks stumble over farm aid

Mumbai: Trade talks among the World Trade Organisation''s four most powerful members — the US, EU, India and Brazil — ended in failure for lack of an agreement on farm subsidy cuts, Brazilian foreign minister Celso Amorim said.

"It was useless to continue the discussions based on the numbers that were on the table," Amorim said at a news conference.

The talks had been described as crucial in the WTO''s drive to complete a new global trade pact by the end of the year. "It is a setback, let us not hide it," Amorim said.

Indian commerce minister Kamal Nath, blamed US unwillingness to cut its farm subsidies for the collapse of the talks.

The issue of farm tariffs is politically charged in a number of European countries, particularly France. Critics of the subsidies say they unfairly deflate international prices, making it impossible for poorer nations to develop their economies by selling their agricultural produce abroad.

Officials said that the EU showed flexibility on the sensitive topic of farm tariffs, but that India held firm in defending its agricultural sector from foreign competition. The EU denied that it had shifted its position in the talks.

Brazil and India also presented positions on easing access to their industrial markets that were still far away from US and EU demands, according to officials present in the meetings.

Washington has demanded that Brussels and major developing countries provide greater market access for American farm exports in exchange for the subsidy cuts.

Officials sources pointed out that while the US indicated it was willing to limit its farm subsidies to $17 billion, the G-4 insisted on a figure somewhere below $15 billion.

The current round of global talks aims to add billions of dollars to the world economy and lift millions of people out of poverty through new trade flows. But negotiations have struggled since their inception six years ago, largely because of wrangling between rich and poor countries over eliminating barriers to agricultural trade.

The four members did not have a mandate to negotiate on behalf of the all of the WTO''s 150 members, but as their positions cover the range of positions in the Geneva-based commerce body, agreement by them on some of the outstanding farm trade and manufacturing questions was seen as a key test of whether an overall trade deal could be reached.