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Development vs trade?

August 11, 2008

Abstract: Does the failure of the Doha round also signify a failure of the dominant paradigm of freer trade and global integration leading to faster and more inclusive growth? Not necessarily, because other factors need to be considered.  In the context of trade talks in agriculture, India’s insistence on extensive safeguards against agricultural imports might be construed as anti-trade. But it is to be expected from a country committed to protecting the incomes of its large labour-force which is dependent on the sector. Nevertheless, India (and other countries) have fully realized that larger markets and cheaper inputs contribute to significantly better performance and would prefer to be a party to trade integration. Thus, regional trade agreements, among a smaller group of countries, operating within a similar environment and performing at comparable levels, are more likely to be forged and succeed. Eventually the survival and expansion of the global trading system may depend on the expansion and success of regional trade agreements.

Keywords: Doha round; free-trade; regional trade agreements

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