India yesterday rejected a proposed World Trade Organisation package, casting a cloud over a high-stakes conference tasked with reviving the WTO's faltering efforts to liberalise global commerce.
The package, which New Delhi feared could endanger its efforts to subsidise food, "cannot be accepted", commerce minister Anand Sharma said.
The Bali package would exempt India from any WTO challenges on subsidies for about four years, but New Delhi wants a blanket exemption until a permanent solution is negotiated.
"Agriculture sustains millions of subsistence farmers. Their interests must be secured. Food security is essential for four billion people of the world," Sharma told his counterparts on the Indonesian resort island of Bali.
"Yes, we have rejected it," he said later, calling it a "final decision".
His comments appeared to torpedo WTO chief Roberto Azevedo's hope that delegates could agree on a modest package of measures to keep alive the multilateral organisation's stumbling 12-year-old drive to slash trade barriers.
"I am an optimist by nature, but today I must admit I am in a somewhat sombre mood," EU Trade Commissioner Karel De Gucht said.
One by one, delegates to the four-day conference warned Bali could be the last chance to rescue the WTO's vision of an open trading environment fair to both rich and poor countries.
"Leaving Bali this week without an agreement would deal a debilitating blow to the WTO as a forum for multilateral negotiations," said US Trade Representative Michael Froman. "And if that happens, the unfortunate truth is that the loss would be felt most heavily by those members who can least afford it."
The WTO launched the "Doha Round" of talks in Qatar in 2001, seeking to overhaul the world trading system by setting a global framework of rules and tearing down barriers.
But protectionist disputes between rich and poor countries, and the WTO's insistence that an accord be unanimous, have made progress frustratingly elusive.
Meanwhile, alternative regional pacts between major trading nations, including the 12-nation Trans-Pacific Partnership pushed by Washington, have emerged, threatening the WTO with obsolescence.