Eye on US, Jaishankar pitches against linking tariff with non-trade matters
In his address to the virtual Brics meeting, Jaishankar said it was imperative that economic practices were fair, transparent and to everyone’s benefit
NEW DELHI: India on Monday urged the Brics grouping to focus on stabilising the global economy and world order while opposing unfair trade practices and increased barriers at a virtual summit of the bloc of emerging economies convened to discuss the impact of the tariff policies of the Trump administration in the US.
External affairs minister S Jaishankar, who represented the Indian government at the meeting convened by President Luiz Inacio Lula da Silva of Brazil, the current chair of Brics, also called for the protection of the global trading system based on an open, fair, non-discriminatory and rules-based approach.
The Indian side further called on the 10-member grouping, which also includes China, Iran and Russia, to address the impact of conflicts in Ukraine and West Asia on the Global South and to back the reform of multilateralism. Both India and Brazil have been hit with 50% tariffs by the Trump administration, among the highest in the world.
Jaishankar noted in his address that the multilateral system “appears to be failing” following the impact of the Covid-19 pandemic, major conflicts in Ukraine and West Asia, volatility in trade and investment flows and extreme climate events, and said: “Today, the focus is on stabilising the international economy and the world order.”
He added, “The international trading system is based on the foundational principles of open, fair, transparent, non-discriminatory, inclusive, equitable and a rules-based approach with special and differential treatment for developing countries. India strongly believes that this should be protected and nurtured.”
Without directly referring to the trade and tariff policies of the Trump administration, Jaishankar said “trade patterns and market access” were key issues in the global economic debate.
“The world requires constructive and cooperative approaches to promote trade that is sustainable. Increasing barriers and complicating transactions will not help. Neither would the linking of trade measures to non-trade matters,” he said, in an apparent reference to the US slapping a 25% punitive tariff on Indian goods over the purchase of Russian energy.
The virtual Brics Summit was held at a time when India-US relations have been impacted by strains not witnessed in almost two decades, with senior officials of the Trump administration criticising India on an almost daily basis over its ties with Russia, including purchases of oil and military hardware, and “profiteering” from the reselling of Russian energy.
At a time when the world is seeking a stable and predictable environment for trade and investment, economic practices must be “fair, transparent and to everyone’s benefit”, Jaishankar said. “When there are multiple disruptions, our objective should be to proof it against such shocks. That means creating more resilient, reliable, redundant and shorter supply chains,” he said.
It is also important to “democratise manufacturing and production and encourage their growth in different geographies” in order to contribute to regional self-sufficiency and “relieve anxieties at times of uncertainty”, he added.
Jaishankar said the world order has also been impacted by serious stresses, including conflicts, volatility in trade flows and a slowing down of the sustainable development goals (SDGs), being left unaddressed. The ongoing conflicts have direct developmental and supply chain implications, he said.
The Brics member states have been deeply affected by these developments and need to find common ground between their national policies to act on these issues, he said. Brics can also set an example by reviewing trade flows among member states.
“Where India is concerned, some of our biggest deficits are with Brics partners and we have been pressing for expeditious solutions. We hope that this realisation will be part of the takeaways from today’s meeting,” he said.
Emphasising the need to resolve the conflicts in Ukraine and West Asia, Jaishankar said these have negatively impacted the food, energy and fertiliser security of the Global South.
“Where shipping is targeted, not just trade but livelihoods also suffer. A selective protection cannot be a global answer. An early end to the hostilities and undertaking diplomacy to ensure a durable solution is the obvious pathway before us,” he said.
Jaishankar also reiterated India’s call for the reform of institutions of global governance, including the United Nations, that have failed to tackle contemporary challenges. Noting that “gridlocks have undermined the search for common ground” on these issues, he said the Brics grouping should become a “strong voice” for urgent reforms of multilateralism, the UN and its Security Council.
At the same time, Brics must remain focused on challenges such as climate change and climate justice, where there is a need for new initiatives such as the International Solar Alliance, Coalition for Disaster Resilient Infrastructure and Global Bio-fuels Alliance, he said.
Chinese President Xi Jinping, in his address, argued that hegemonism, unilateralism, and protectionism was becoming more rampant. “Trade wars and tariff wars waged by some countries severely disrupt the world economy and undermine international trade rules,” he said, without naming the US.
“At this critical juncture, Brics countries…should act on the Brics spirit of openness, inclusiveness and win-win cooperation, jointly defend multilateralism and the multilateral trading system, advance greater Brics cooperation and build a community with a shared future for humanity,” Xi said.
In this context, Xi said Brics should remain committed to an open global economy and the multilateral trading system with the World Trade Organization (WTO) at its core while opposing “all forms of protectionism”. The bloc should back inclusive economic globalisation and ensure the Global South participates in international cooperation as equals, he said.
