BIMSTEC Foreign Ministers’ meet

GS Paper - 2 (International Relations)

The first-ever Foreign Ministers’ meeting of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) began in Bangkok, Thailand. India’s External Affairs Minister S Jaishankar was also present, and said that areas of coordination challenge that were discussed, including health and energy security.

What is BIMSTEC?

• BIMSTEC is a regional organisation that was established in 1997 with the signing of the Bangkok Declaration.
• Initially known as BIST-EC (Bangladesh-India-Sri Lanka-Thailand Economic Cooperation), the organisation is now known as BIMSTEC and comprises seven members, with Myanmar joining towards the end of 1997, and Bhutan and Nepal in 2004.
• Around 22% of the world’s population lives in the seven countries around the Bay of Bengal, with a combined GDP close to $2.7 trillion.
• All seven countries have sustained average annual rates of growth between 3.4% and 7.5% from 2012 to 2016. A fourth of the world’s traded goods cross the bay every year.
• Cooperation within the BIMSTEC had initially focused on six sectors in 1997 (trade, technology, energy, transport, tourism, and fisheries) and expanded in 2008 to other areas.
• In 2021, a reorganisation led to each of the Member States leading certain sectors. India focuses on security, along with counter-terrorism and transnational crime, disaster management and energy.

Growth of BIMSTEC as a regional forum

• Despite having been in existence for many years, the grouping had been largely ignored until India gave it a renewed push in October 2016, a month after the terrorist attack in Uri.
• Alongside the BRICS summit in Goa, India hosted an outreach summit with leaders of BIMSTEC countries.
• Weeks earlier, some of these countries had supported New Delhi’s call for a boycott of the South Asian Association of Regional Cooperation (SAARC) summit scheduled in Islamabad that November.
• SAARC includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka as its members. When that summit was postponed, India claimed victory in isolating Pakistan.

China on mind

• The Bay of Bengal is crucial for an increasingly assertive China in maintaining its access route to the Indian Ocean.
• As China has undertaken a massive drive to finance and build infrastructure in South and Southeast Asia through the Belt and Road Initiative in almost all BIMSTEC countries, except Bhutan and India, BIMSTEC is a new battleground in the India-China battle for dominance.
• BIMSTEC could allow India to push a constructive agenda to counter Chinese investments, and instead follow best practices for connectivity projects based on recognised international norms. The Chinese projects are widely seen as violating these norms.
• The two organisations — SAARC and BIMSTEC — focus on geographically overlapping regions. However, this does not make them equal alternatives.
• SAARC is a purely regional organisation, whereas BIMSTEC is inter-regional and connects both South Asia and ASEAN.
• Since the SAARC summit has only been postponed, not cancelled the possibility of revival remains.

The Black Sea grain deal expired

GS Paper - 2 (International Relations)

The last ship carrying grain from Ukraine, under a UN-brokered deal that guarantees its safe passage, left the port of Odesa. This deal expired, and Russia has still not agreed to extend it.

What is the Black Sea grain deal?

• Ukraine is among the world’s biggest exporter of foodgrains, such as wheat and corn, and a major contributor to the UN’s food aid programmes.
• When Russia invaded the country and blockaded its ports, it sent food prices soaring and raised fears of food security in the poorer nations of the world. Pakistan, for instance, saw wheat prices skyrocket to crisis levels.
• On 22 July 2022, the UN and Turkey got Russia to agree to the Black Sea Grain Initiative, under which cargo ships would be allowed to travel from and to three Ukrainian ports of Odesa, Chornomorsk and Pivdennyi (Yuzhny), after inspection that they weren’t carrying arms.
• The safe passage in the Black Sea was 310 nautical miles long and three nautical miles wide. The deal has been extended twice, and expires.
• According to a report from June, nearly 32 million tonnes of mostly corn and wheat have been exported by Ukraine under the deal.

Why has Russia not agreed to renew it?

• Russia claims that the promises made to it under the deal have not been met, and it is still facing trouble exporting its own agricultural products and fertilisers because of the many sanctions the West has slapped on it.
• While there is no direct restriction on Russia’s agricultural products, the country says barriers on payment platforms, insurance, shipping and other logistics are hampering its exports.
• Russia has also said that it had agreed to the grain deal in order to help ensure global food security, but Ukraine has since exported mainly to high-and middle-income countries. The UN says while this is true, poorer countries have been helped by food prices cooling down.
• The European Union (EU) is now considering connecting a subsidiary of the Russian Agricultural Bank (Rosselkhozbank) to the Society for Worldwide Interbank Financial Telecommunications (SWIFT), from which it was cut off due to the war, to allow grain and fertiliser transactions.

India, US notify WTO of mutual resolution

GS Paper - 2 (International Relations)

India and the US have mutually resolved all six trade disputes pending at the World Trade Organisation (WTO), in line with the commitment made by the two countries during the US visit of Prime Minister Narendra Modi recently. Both countries have informed the WTO's dispute settlement body (DSB) about the resolution of all the pending disputes. The WTO has already issued a communication with regard to one of the disputes related to the imposition of additional customs duties by India on 28 US products.

More about the News

• The United States and India are pleased to notify the DSB (dispute settlement body), in accordance with Article 3.6 of the Understanding on Rules and Procedures Governing the Settlement of Disputes, that the parties have reached a mutually agreed solution to the matter raised in this dispute, according to a communication of the WTO dated 17 July 2023.
• The two countries have urged the dispute panel that its report should be confined to a brief description of the case and information that a solution has been reached by the two.
• The trade dispute which was resolved pertains to a complaint filed by the US in 2019 against India.
• India had imposed additional customs duties on 28 US products including chickpeas, lentils and apples in retaliation to the US increasing duties on certain steel and aluminium products.
• Against this resolution, India would remove additional duties on eight US products, including chickpeas, lentils and apples, which were imposed in 2019 in response to America's measure to increase tariffs on certain steel and aluminium products.
• During the recent state visit of Prime Minister Narendra Modi to the US, both countries decided the termination of six WTO (World Trade Organisation) disputes and the removal of these retaliatory tariffs on certain US products.

Flashback

• In 2018, the US imposed an import duty of 25 per cent on steel products and 10 per cent on certain aluminium products on grounds of national security. In retaliation, India in June 2019 imposed customs duties on 28 American products.
• The US is the largest trading partner of India. In 2022-23, the bilateral goods trade increased to USD 128.8 billion as against USD 119.5 billion in 2021-22. The six disputes include three initiated by India and as many by the US.
• These included a complaint by India against the US with regard to the imposition of countervailing duties on certain hot rolled carbon steel flat products from India.
• On 9 September 2016, India filed a case against the US pertaining to domestic content requirements and subsidies instituted by the governments of the states of Washington, California, Montana, Massachusetts, Connecticut, Michigan, Delaware and Minnesota, in the energy sector.
• Another dispute filed by the US against India was related to domestic content requirements under the Jawaharlal Nehru National Solar Mission for solar cells and solar modules. In 2018, the US filed a case against India's alleged export subsidy measures.
• Similarly on 3 July 2019, the US filed a dispute against New Delhi on imposition of additional duties with respect to certain products originating in the US.