Sustainable trade should be at the heart of India’s G20 presidency

India took over the G20 presidency from Indonesia on the first of December.

This year’s theme – One Earth, One Family, One Future – reflects a desire to ensure economic growth is balanced with respect for environmental and other social considerations. At the same time, the UK and India are negotiating a trade deal where sustainable development is barely mentioned.

Under Indonesia’s presidency, the 2022 G20 Leaders’ Declaration reiterated the importance of making urgent progress towards the UN Sustainable Development Goals (SDGs), particularly given that multiple global crises are currently hindering progress. Trade deals can have a powerful effect on parties’ ability to achieve the SDGs.

The trade liberalisation that trade deals facilitate has the potential to support the achievement of the SDGs, but if they are not well designed, deals can displace workers, negatively impact social and environmental protections and facilitate bad business practices. The Chair’s summary of the latest meeting of G20 Trade and Investment Ministers shows that members recognise the relationship between trade and sustainable development, and are keen to ensure they are aligned. However, these statements have not been incorporated into negotiations towards a trade deal between the UK and India.

The UK and India are about to launch the sixth round of negotiations for their bilateral trade deal. There are several concerning elements of this trade deal, not least that the UK is pursuing a deal in the context of serious human rights violations in India, including the detention of UK national Jagtar Singh Johal for five years without trial. The trade deal itself could undermine several of the UN SDGs, such as SDG 13 which commits parties to “take urgent action to combat climate change and its impacts.”

As it stands, the UK’s assessment predicts that the deal will cause an increase in greenhouse gas (GHG) emissions when the world has long agreed a dramatic reduction is needed to tackle the climate crisis. A scoping assessment of the deal with India carried out by the UK government estimated overall GHG emissions would increase between 0.08% and 0.14%. It also found that trade-related transport emissions would increase by 18% to 36%, depending on the depth of the deal.

Increases in emissions in India were not estimated by the assessment, despite the UK acknowledging these were likely to be “significantly greater” than the equivalent sectors in the UK. The scoping assessment also predicts multifaceted environmental degradation including deforestation, habitat and biodiversity loss, air and water pollution. There is no indication that the trade deal will contain provisions to prevent or mitigate these predicted environmental impacts; the most likely outcome is a weak, non-binding chapter on the environment which would not directly address the issues outlined above.

Another key SDG that can be impacted by trade deals is SDG 3, which commits signatories “to ensure healthy lives and promote well-being for all at all ages.” This has become even more urgent since the pandemic. Trade deals can have profound implications for a range of health policies. One of the most controversial in recent years has been medicine pricing. Trade deals contain provisions on intellectual property (IP) protection which can extend patent terms and introduce a range of other measures that restrict the ability of countries to produce more affordable generic medicines.

Around the world, people’s access to essential medicines is restricted by high prices, which is in part caused by IP rights enforced through trade deals. India is the world’s largest exporter of low cost, generic medicines, including for diseases such as HIV and tuberculosis and has long opposed the liberalisation of its IP regime.

The UK’s proposals for the IP chapter in the UK-India trade agreement were recently leaked and if agreed, would lead to significant restrictions on India’s medicines industry, driving up prices for essential medicines sold across the global South and pushing the achievement of SDG 3 out of reach. The leaked proposals show that the UK wants India to change its domestic laws on IP and drug pricing, which would lead to increased monopolies and a detrimental effect on India’s ability to produce affordable and quality-assured medicines.

The theme of India’s G20 presidency is to take a holistic approach to discussions with sustainability and inclusivity high on the agenda. This is an approach that urgently needs to be applied to trade deals, which affect a wide range of policy issues.

India has an opportunity, as president of the G20, to ensure the links between trade and sustainable development are recognised and that trade deals are aligned with achieving the SDGs. Central to this will be to ensure that G20 members recognise the importance of ensuring the priorities of all nations, including those that are not G20 members, and individuals are considered. The UK and India both have an opportunity, during their ongoing bilateral negotiations, to demonstrate that this can be done but this requires a significant change of direction.