An agreement clinched at Geneva by 147 members of the World Trade Organization on a 'framework for negotiations' in the wee hours of August 1 after a five-day hectic negotiations can hardly be called a breakthrough in the year-long deadlock on major issues. But what it has achieved is no mean gain.

As a major step forward, the watered-down compromise has averted an outright collapse of Doha round of negotiations which would have sparked a fresh round of protectionism and trade wars and even put the very survival of the WTO in doubt.

Had it happened, the world would have faced the risk of being plunged back into a time like the 1930s when the American and global recessions were prolonged by an absence of international co-operation on trade. No member country, rich or poor, would like it to happen.

That appears to be the driving force behind the new deal as otherwise it offers nothing concrete to break the abominable status quo or grant an immediate concession to the developing countries to remove at least some distortions in trade.

The only relieving factor, however, is what could be called a 'confession' by the developed countries that the subsidies they pay to their farmers (one billion dollars a day) is an unfair practice as evidenced by their willingness (or a commitment?) to gradually eliminate them.

It's a major change of heart as only a few months back, the US had obstinately refused even to accept the WTO ruling against cotton subsidies on Brazil's complaint.

In a nutshell, the July agreement is basically, as Australian Prime Minister John Howard has aptly described it, "an agreement to talk in detail about an agreement." In other words it is a promise by rich nations to consider the politically tough concessions like lowering trade barriers and reducing subsidies to their farmers in the future.

Seen in that perspective, the deal can hardly be called a "major event" or a "victory" of the Third World nor is there any reason to get over-excited over the promises because these can always be broken.

Setting a tentative deadline for the total elimination of farm export subsidies will be a tough item on the agenda, something to be fiercely battled between the two contending sides before reaching a decision, in the meetings that will resume in September at Geneva, after a recess.

The agreement sets December 2005 as a new deadline for the completion of the current talks when a ministerial meeting is scheduled to be held in Hong Kong. Delegates from developing countries had earlier thought 2007 as a more suitable deadline since the intense negotiations on controversial issues may not be completed within 15 months.

However, the actual elimination of the subsidies may, if talks do not run into trouble, take place some time around 2015 or 2017, according to French agriculture minister Herve Gaymard.

"If the current round of talks is completed," the agreement reads, "all subsidy payments to farmers for exported products will be eliminated by a credible end date." What this credible date could be? Some western delegates say this could be 2020.

And to begin with, only 20 per cent of the subsidies are to be eliminated after lengthy rounds of bargains. So, the prevailing milieu makes the new deal as vague as has been several provisions in other WTO agreements because of peculiar wording.

An American trade expert, Michael Finger, told Christian Science Monitor last week that he spent a whole day wading through a section of a recent agreement but could not understand what it meant.

What is also difficult to understand is the euphoric mood prevailing in India and Pakistan. New Delhi has described the very revival of talks as a "major victory" and said that from the new deal it has "secured significant gains and succeeded in fully protecting its interests in agriculture as well as in other areas."

It is interesting to note that India, being a key player at Geneva and a leader of G-20 along with Brazil, has initially opposed the July 30 draft and its Commerce Minister Kamal Nath had threatened to walk out if its interests were not met in the revised draft.

But many were surprised to seem him praising the final draft which is no different from the earlier one and there are many issues in the framework agreement which not only disfavour India but also the majority of the poorer and smaller nations.

Similarly, Pakistan's Commerce Minister Humayun Akhtar has been calculating some imaginary gains from the agreement. He thinks it will boost Pakistan's exports of diary products to the extent of 2 to 3 billion dollars, of cotton by $300 million, of rice by $200 million and in case of sugar by $100 million when the subsidies are gone. When, if at all, such benefits will accrue nobody is aware, nor the minister himself.

The farm trade agreement is, without any doubt, heavily weighed in favour of the rich countries, particularly in its clauses about agriculture and NAMA (non-agricultural market access), cotton, the Singapore issues, in particular trade facilitation, and services.

The agreement clearly ignores the interests of the developing world when it comes to special and differential treatment (SDT) - provisions that give special rights to developing countries.

It became possible after a group of rich states, called the "Quad," and consisting of Canada, the EU, Japan and the US worked behind the scenes the whole night (of July 31) to try and break up the unity of different groups particularly those of Africa with a carrot and stick approach of aid and special agreements.

The British watchdog, Oxfam, called it "another display of muscle by rich countries". The final text of the agreement, Oxfam said, emerged from a meeting of some 30 countries in which only the governments least opposed to western positions were allowed to participate and the others had to either accept or reject the results.

It was in these circumstances that African nations, particularly the four big West African cotton producers - Benin, Senegal, Burkina Faso, and Mali - agreed to back off on their demand for separate negotiations on cotton. In return they'll get extra assistance from the World Bank. They were, in fact, bought off, delegates said.

Meanwhile, no substantive talks or decisions are possible until the elections in the United States are over as only then the position of the US, the most important player, on some vital issues will be clear.

It means serious trade talks will resume early next year. In other words, it allows the WTO to put the current round of talks into a state of suspension for six months.

The agreement has come in for initial praise from the interested parties and international civil society such as Friend of Services, and other industry lobbyists, but is being criticised by campaign groups such as Focus on the Global South and Third World Network.

They are of the opinion that the results of this agreement fall far short of what is needed to reform world trade rules so that they can accommodate the concerns of the poor nations. They say "negotiators may trumpet breakthroughs on export subsidies and cotton but there are no cast-iron commitments here and no clear timeline for reform."

Following are some of the controversial aspects of the agreement:

(1) Definition of single undertaking: The wording of the agreement had been amended from that of the Doha Ministerial Declaration which specified the round as "a Single Undertaking". Now it is mentioned in para 2 of Annex A on Agriculture as " the Single Undertaking" which will have serious ramifications on the obligations of the poor countries.