GATs Negotiations and India: Evolution and State of Play

Abstract

India’s negotiating position on services has undergone a paradigm shift since the Uruguay Round. From being a leading opponent of the GATS in the early stages, India has now emerged as one of the champions of services trade liberalisation under the GATS. This more recent negotiating stance of India on services is partly owing to the growing importance of the services sector in its economy. With a vast pool of educated and skilled workers in its workforce, the country also has a huge offensive interest in export of Cross-border services (Mode 1) and in the services involving the Movement of Natural Persons (Mode 4). Written against this backdrop, the paper tracks down the evolution of the GATS negotiations since its inception and puts forward a concise overview of the state of play. The paper covers extensively the key issues under the purview of the GATS from an Indian perspective. It also makes important policy suggestions for India on certain sensitive sectors like retail, higher education, audio-visual and legal services. In view of the fact that not much forward movement is expected in the near future in market access in Modes 1 and 4 in the key markets of India’s interest, the paper argues that India needs to reconsider and reassess its aggressive policy stance on services. Importantly, the paper stresses that, upon resumption of the Doha negotiations, India should refrain from considering any compromise on its interests in agriculture and Non Agricultural Market Access (NAMA) for pushing through its offensive interests in services.