India, South Africa and Indonesia have submitted a joint communication to the WTO on e-commerce making a case for “invigorated’’ discussions under the present work programme on developmental aspects to check the inequitable gains arising from the digital economy. This is for consideration at the 12th Ministerial Conference in Geneva beginning on June 12.
“India and the other supporting countries want to question the continuous extension of the moratorium on customs duties on electronic transmissions, which favour the developed countries. They also seek discussions around redressing the uneven spread of global electronic commerce and inequitable gains arising from it, as has been mandated in the existing work programme on e-commerce,” a source tracking the matter told BusinessLine.
The submission by the three is also important in the light of attempts made by a group of countries, led by several developed nations, to push a plurilateral agreement (under the so-call joint statement initiative) on framing e-commerce rules. “New Delhi has been opposing such an initiative on the ground that it was important for many developing countries to first understand the implications of e-commerce on market structures and technical issues such as data storage, transfer of technology and loss of traditional jobs, before they are ready to discuss e-commerce rules,” the source explained.
Technological divide
In the draft declaration submitted to the WTO on Thursday, the three countries highlighted concerns about the deep digital and technological divide afflicting developing and least developed countries and the need to address these.
The work programme on e-commerce was adopted by WTO members in September 1998 to examine all trade-related issues relating to global electronic commerce, taking into account the economic, financial, and development needs of developing countries. India and like-minded countries believe that discussions under it needed to be intensified, including on the need to continuously extend the moratorium on customs duty on e-transmissions.
Revenue loss
According to an UNCTAD study, developing countries lose revenue worth $10 billion every year on account of the moratorium which doesn’t benefit them in any significant way.
India and South Africa have been making several joint submissions highlighting the adverse impact of the moratorium on developing countries and suggesting that a reconsideration is important for developing countries to preserve policy space for their digital advancement, to regulate imports and to generate revenue through customs duties.