The chairman of the negotiating group on market access for non-agricultural products has come out with the first draft of the elements of modalities for negotiations. The report circulated among the WTO members on May 16 proposes a formula approach for reduction or elimination of tariffs on all industrial products.The proposal also seeks sectoral elimination and binding of all tariffs on products of export interest to the Third World and the least developed countries in three phases, subject to negotiations. Besides, a longer implementation period for tariff reduction for the developing countries and allowing them to keep up to 5 per cent of their tariff lines unbound, also have been outlined in the draft.The modalities to be established by May 31 will set the parameters of the final agreement on the subject to be reached by January 1, 2005.The draft comes ahead of the negotiating group’s three-day meeting starting in Geneva from May 26-28. A senior official from the commerce ministry’s trade policy division is expected to attend the meeting.As per the formula, the basis for reduction or elimination of tariffs on all industrial products will be the base rate, that is, the final bound rates after full implementation of the current concessions. For unbound items, the basis for commencing the tariff reductions shall be two times the most-favoured-nation (MFN) applied rate and the base year shall be 2001.
