India bears critical mien to US proposal on ecommerce, cloud computing

The programme calls for framing trade rules for cross-border data flows, removing localisation requirements for protecting personal data within national borders and agreeing to proper coverage of cloud computing as part of computer and related services, livemint.com reports. The US has been proposing a solid work programme on ecommerce as one of its main priorities and which states that cloud computing infrastructure is critical to such business developments. US companies such as Amazon, Microsoft and International Business Machines (IBM) have the lion’s share in cloud computing. For some time now, the US has been working hard on binding legal rules for cloud computing, in which its companies have a major share.

The US’ proposal on ecommerce came up for discussion at the WTO’s Council for Trade in Services (CTS) and a US official argued that US government wants to focus on `trade-related issues of ecommerce`, including on issues of cloud computing and finding a balance between privacy and cross-border data flows. The US also maintained that its proposal is not designed to be included in the post-Bali work programme for immediate negotiations, according to officials familiar with the meeting, the source cites.

However, members delivered “mixed” responses to the US proposal. Several industrialised countries in the European Union, Canada and Australia, along with Mexico, Chile and South Korea, strongly supported the US proposal. In a sharp response, developing countries such as India, China, Brazil, Ecuador and Argentina expressed concerns over the underlying goals of the US proposal to expand the ecommerce agenda despite the lack of mandate from the members at this juncture. India said the US proposal was already rejected in 2011 and that its proposal is “prescriptive”. India maintained that it is interested in having a conceptual exploratory and experience-sharing dialogue without leading to any market-access negotiations.

China said that while it would welcome the proposal on ecommerce from the US which recognises the importance of cross-border flows, it is concerned that the US had imposed severe restrictions on localisation of services and data flows. Brazil agreed with India that there is a mismatch between what the US had proposed in its paper and what it is now claiming in its call for a dialogue. In the face of sharp divide, the chair of the CTS, ambassador Martin Eyjolfsson from Iceland, said he would hold more consultations to resolve the differences among members for pursuing the dialogue.