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Bali Trade Deal May Be Implemented Despite India Concerns

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The BRICS group of emerging market nations is confident a global trade reform pact will be implemented despite concerns by India over its food security, Brazil's trade minister said on Monday (14 July).

"We are confident that the Bali agreement will be implemented by all," Brazilian Trade Minister Mauro Borges told reporters are the end of a ministerial meeting ahead of the BRICS annual summit.

The deal struck in December in Bali to lower trade barriers was the World Trade Organization's first global agreement since it was created in 1995 and revived global talks after the failure of the Doha round.

But India has criticised the pact for putting trade facilitation ahead of a compromise on agricultural subsidies, a crucial issue for a country that needs to stockpile food for its poor.

That disagreement over subsidies has raised fears that the Asian nation would not ratify the pact reached in Bali and derail the latest effort to free up to $1 trillion in global trade flows.

Borges said India's concern for the survival of its family agriculture on which millions depends is very understandable, but he said it was not an "ultimatum" against implementing the Bali agreement by the July 31 deadline.

South Africa's Trade Minister Rob Davies said his country had no difficulty in implementing the trade facilitation steps, but he said they should be balanced by complementary measures to help agriculture in poorer developing nations.

"There has been a perception by many developing countries that there is an inexorable march towards implementation of trade facilitation, but the rest been left behind," he said.

"The way to resolve this impasse is not to try to brow beat people to put up their hands and concede, but is actually to address the real concerns and issues that a number of the poorest countries are facing."


BRICS Bank Hits Snag
On the eve of the signing of a deal to launch a joint development bank, the BRICS nations have still not agreed on where the lender will be headquartered, a senior official involved in the talks told Reuters late on Monday.

The leaders of the five emerging market economies are expected to sign a deal on Tuesday that creates the $100 billion bank and a reserves fund of the same size to challenge Western dominance over global finance.

The five nations are Brazil, China, India, Russia and South Africa.

Negotiations have stalled for now on a dispute between China, India and South Africa over who will host the bank. The disagreement has also delayed a decision on which of the countries will hold the first 5-year presidency of the bank.

"This should be easy to resolve but we have this dispute. If it doesn't move forward, we may have to leave the decision for another meeting," said the official, who declined to be named.

Another negotiator confirmed that no decision has been reached.

A delay could be an embarrassment for the BRICS, which see the creation of the bank as a major step to gain more influence in the shaping of the world's financial architecture.

The official said that if no deal was reached on Tuesday, the leaders could still sign off on creation of the bank and decide on the headquarters and its president at a later date.

Negotiations to create the bank dragged on for more than two years as Brazil and India fought China's attempts to get a bigger share in the lender than the others.

The stark economic and political differences between the BRICS countries has made it difficult for the group to turn rhetoric to concrete action in coordinating policies.

Russian and Indian officials have signaled that China's business hub, Shanghai, was the front-runner in the race to land the headquarters.