How International Trade Organisations Are Using False Narratives To Undermine India's Standing

Here’s a story of how international organisations build and use false narratives to beat up whoever they want to.

Someone had once called this practice as Salma quotes Sabrina. Here’s an international intergovernmental version of this approach.

World Trade Organization (WTO) publishes an annual report called “Aid for Trade Global Review”.

This report explains among other things, how donors/developed countries are helping the developing world in their efforts to boost trade or trade capabilities.

Here is a link to the report which can be accessed from WTO home page.

This report which is 172 pages long has only five mentions of India — two acknowledgements of pictures and three mentions in the context of specific programmes India is involved in for digital innovations.

So far so good — basically the main report shows that while the Aid for Trade remains an important issue for many countries, India is not really looking for any specific assistance at this stage as far as trade capabilities are concerned.

However, there is a parallel report prepared jointly by WTO and OECD on Aid for Trade, which can be found here and here.

This report is being prepared since 2006 when the Aid for Trade Initiative was launched. Instead of using its own study on Aid for Trade, WTO uses this joint WTO-OECD report for the periodic Global Review of Aid for Trade initiative. The foreword of this report has these details.

Let us compare this report against the WTO one for initiatives supporting Aid for Trade.

Page 31 shows the five categories in which the Aid for Trade data is collected and counted as specific assistance for trade. Snapshot below.

In 2005, it may have been easy to convince developing world that ‘ALL’ financing for infrastructure like roads, ports, telecom should be counted against efforts to boost trade.

But clearly that’s a flawed logic.

These factors are indeed important but neither do they have causal links for international trade in every case nor trade would be the only beneficiary even where there was a link.

This is hardly rocket science.

But given this category definition, the biggest donors (Page 30 of the report) emerge as — Japan, World Bank, EU, Germany, France, UK, ADB, United States, Central American Bank for Economic Integration and African Development Bank.

These donors now claim that they are spending billions of dollars to help developing world improve trade.

Let us peel this further.

Japan funding will include JICA projects like bullet trains or Mumbai Metro 3 or MTHL and is shown as aid for boosting trade capabilities in India. KfW, part of German funding is helping urban projects in India and that is classified as aid.

Asian Development Bank does not even work in the pure trade domain but its funding is classified as aid for trade.

These are just Indian examples but every ‘recipient’ country will have its own.

Bizarre?

It gets even more bizarre when you realise that most of this money is not even aid to start off.

Much of this comes in the form of debt/loans, which are to be repaid by the ‘beneficiary countries’.

In fact, the loans are given in many cases so that the ‘donor’ can sell its own technology/products for the projects being funded.

Organisations like WTO and OECD, which are supposed to be champions of transparency, do not even divide this ‘aid’ as grants and loans.

Neither do they give a list of projects where this supposed aid is given. The reason is obvious — why would you like to expose yourself.

Yet there is blatant classification of such funding as Aid for Trade. Classic example of how framing effect can be used to prove what you want.

This report has a huge impact on India. Why? Because a lot of infrastructure projects are taking place in India — Page 31 has the details.

India is now suddenly shown as the highest recipient of ‘aid’.

What purpose does this serve? This is used to shame India that a large economy is actually reliant on aid.

Moreover, in IMF, World Bank, WTO forums, this information is also used to instigate other developing countries against India, saying that India acts like a big economy but is instead taking away your ‘aid money’.

For a minute let us assume that all the money given by ‘donors’ was ‘aid’.

Then why would ‘donors’ cut aid in the Covid year 2020?

Even ‘donors’ like World Bank and ADB have cut their disbursements, which is counter-productive to the logic of providing necessary financial support during a Covid year.

Who amplifies this nonsense?

Well, of course, the Indian media does, because why read the details of any report.

Indian media itself tries to shame the country where the entire reporting methodology is dodgy.

And WTO then further muddies the waters by asking investments to be counted as aid!

How can investments made for profit motive be called aid?

Well, if loans can be called so in a formal report, it should not surprise anyone that whacky ideas like making business investments be called aid for developing countries.

Excerpt of WTO director general’s speech here.

India got record $80 billion FDI? Wonderful, this is aid and doles given by the rich world to improve India’s trade capabilities.

This won’t be surprising if this shows up in the next WTO-OECD report.

This is how the global financial architecture works against Indian interests. This is how they want to label India as a good for nothing, poor country.

India’s every rise will be systemically challenged not just by countries that are going to be impacted along the way, but also by the international organisations which are the fiefdom of a few Western countries.

Their officials — usually career international diplomats — will play along. And they will find more than willing support from Indian coconuts.

A shameful state of affairs.