India Torpedoed TFA; Obama's Emissary Kerry Made a Fool of Himself
August 2, 2014 • 9:58AM

Withstanding the full pressure, India's newly-elected Narendra Modi government stuck to its guns and did not allow the developed nations, wielding power within the World Trade Organization (WTO), to provide passage of the Trade Facilitation Agreement (TFA). India's Commerce Secretary Rajeev Kher made clear the day after the July 31 deadline that India remains committed to the pact and will continue to pursue its proposal to find a permanent solution to its food security issues.

That India would not budge from its stated position was made clear by Commerce Minister Nirmala Sitharaman at the meeting of trade ministers of the Group of 20 nations in Sydney on July 19. When it became evident that New Delhi has no intention to go along with what the developed nations demand, U.S. President Barack Obama sent his Secretary of Commerce Penny Pritzker and Secretary of State John Kerry, who were scheduled to be in New Delhi on a three-day (July 30-Aug. 1) visit, to participate in the India-U.S. annual strategic talks, to twist arms and make India agree.

Prior to his departure for India, Kerry, in an op-ed co-authored by Pritzker, wrote: "As we work with our trading partners around the world to advance trade and investment liberalization, India must decide where it fits in the global trading system. Its commitment to a rules-based trading order and its willingness to fulfill its obligation will be a key indication."

Kerry's statement did not go over well in India, where it was perceived as another attempt by the Obama Administration to undermine India's self-interests. During his meeting with Finance Minister Arun Jaitley, Kerry brought up the issue, pointing out how India will get in the way of a trade boom that would ensue the implementation of the TFA and how every participating nation could benefit from TFA implementation. Jaitley made clear that India's position was firm.

And yet, on Aug. 1, after the TFA implementation was scuttled at Geneva due to Indian reticence, Kerry took yet another stab at it, telling Modi that India's refusal to sign a global trade deal sent the wrong signal, and urged New Delhi to work to resolve the row as soon as possible. "Failure to sign the Trade Facilitation Agreement sent a confusing signal and undermined the very image Prime Minister Modi is trying to send about India," a State Department official told reporters after Kerry's meeting with Modi.