Suresh Prabhu, the prime minister’s sherpa at the G20, said on Monday that the World Trade Organization is on a ventilator and it has to come out of it.
“A new world is going to unfold and we don’t know as yet what it would look like. Multilateralism per se is under a very serious threat. The question is how to deal with this threat when it (multilateralism) is needed most,” he said on a webinar organised bY Consumer Unity & Trust Society International (CUTS).
Referring to India’s initiative following the Buenos Aires ministerial conference in December, 2017, which could not agree on a consensus-based ministerial declaration, he said,“We have to find a solution. It can’t be one way or another. WTO’s reforms have to take into account the interests of all members. It has to come out with a forward-looking agenda in an inclusive manner.”
He urged CUTS to write a paper on “what would happen to a world without the WTO”. “We need to find a clear answer to this question. For India to grow, we need a body like the WTO to govern world trade,” he underlined.
Pascal Lamy, former director general of the WTO said a multilateral, rule-based and open trading system will be even more challenged in a post-Covid world.
“From open trade, the underlining doctrine of trade policies of various countries is becoming protectionism. We expect massive interventions in all economies and that will inevitably distort trade by stifling competition,” he said
Also, there is likely to be a steep increase in precautionary measures, which will further harm cross-border trade, Lamy said. “In sum, we will see a more fragmented trading system,” he argued.
However, the good news is that there will be further digitisation of trade and India will be in a position to take advantage of it, he added.