Topic 1 : WTO’s investment facilitation negotiations are not illegal
Context
One of the significant developments at the 13th Ministerial Conference (MC13) of the World Trade Organization (WTO) in Abu Dhabi was the non-adoption of the agreement on investment facilitation for development (IFD).
IFD
- IFA is a trade agreement proposed by the World Trade Organization.
- Its aim is to create legally binding provisions by facilitating investment flows.
- It requires states to augment regulatory transparency and predictability of investment measures.
- Participation in this joint initiative is open to all WTO Members.
- India did not join the IFA negotiations which is backed by more than 100 countries.
India’s concerns
- The IFD Agreement, among other things, will require states to augment regulatory transparency, and streamline administrative procedures to bolster foreign investment inflows.
- Importantly, this agreement does not contain provisions on market access, investment protection, and investor-state dispute settlement (ISDS).
- India and South Africa played a crucial role in not letting the IFD agreement become a part of the WTO rulebook.
- India does not seem to be exceedingly concerned about the text of the IFD agreement. Instead, India’s principal concerns are twofold.
- First, the question of whether investment can be part of the WTO. And second, the process followed to make the IFD agreement a part of the WTO rulebook.
ISDS
- Investor-state dispute settlement (ISDS) is a system through which investors can sue countries for discriminatory practices concerning foreign direct investment.
- The protection provided by ISDS acts as a lever to boost foreign investment. ISDS is an instrument of public international law and is included in a number of bilateral investment treaties (BITs).
Investment is not trade
- On whether investment can be part of the WTO, India’s chief contention is that investment per se is not trade.
- In other words, investment could or could not result in cross-border trade.
- According to the Organisation for Economic Co-operation and Development, about 70% of international trade occurs through global value chains, which are characterised by trade and investment, thus proving the close relationship between the two.
- Therefore, it is unsurprising that several modern-day free trade agreements, such as the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership include detailed investment provisions covering both facilitation and protection.
- Interestingly, India’s newly minted trade agreement with the European Free Trade Association also contains provisions on investment, though it is restricted to facilitation and promotion measures.
- Regarding the process followed in negotiating the IFD Agreement, India’s foremost assertion is that there is no mandate to conduct negotiations on investment.
- Since all countries never agreed to launch negotiations on an IFD Agreement, according to India, IFD negotiations and the subsequent text that came up for adoption are illegal.
- India is correct in arguing that there is a negative mandate to launch negotiations on the relationship between trade and investment.
Way forward
- An essential function of the WTO is to update existing rules and make new ones to govern the increasingly complex nature of international trade.
- However, the WTO’s decision-making process remains deadlocked because of the colossal difficulties in arriving at consensus.
- From this perspective, PAs such as the IFD agreement are essential for reinvigorating the WTO’s stalemated legislative function.
- India, which will soon be the third biggest economy, should reconsider its defensive approach towards PAs, as in the proposed IFD Agreement in the WTO.
Topic 2 : On sustainable building materials
Introduction :
India is witnessing an unprecedented construction boom, with over 3,00,000 housing units erected annually. But the building sector, a major energy consumer, accounts for over 33% of India’s electricity usage, contributing to environmental degradation and climate change. The India Cooling Action Plan forecasts an eight-fold increase in cooling demand between 2017 and 2037, emphasising the need for thermal comfort while reducing active cooling demand.
Construction sector being energy efficient
- Addressing energy inefficiency in residential buildings is crucial, given India’s rising energy and cooling demand due to economic growth, urbanisation, heat islands, and climate change.
- Initiatives like the Eco-Niwas Samhita (ENS) and the Residential Energy Conservation Building Code are steps in the right direction.
- The ENS introduces the Residential Envelope Transmittance Value (RETV), a metric measuring heat transfer through a building’s envelope.
- Lower RETV values lead to cooler indoor environments and decreased energy usage.
- For optimal efficiency, improved occupant comfort, and lower utility expenses, it’s recommended to maintain an RETV of 15W/m2 or less.
- However, current construction trends favour fast-paced, energy-intensive techniques with active cooling strategies, leading to compromises in thermal comfort.
- There needs to be more widespread knowledge about climate-appropriate design and architecture, with perceptions of high first costs as a barrier to the design and construction of climate-responsive buildings needing to change.
Optimal materials
- India highlighted the popularity of materials like Autoclaved Aerated Concrete (AAC) blocks, red bricks, fly ash, and monolithic concrete (Mivan).
- Despite concerns about sustainability, monolithic concrete construction was favoured by building developers for its speed, strength, quality, and scalability.
- The RETV evaluation for these buildings revealed that AAC blocks consistently had the lowest RETV across all climatic conditions, indicating their potential as a thermally efficient material.
- Based on literature review, a comparison of building materials for a 100 sq. ft wall area displayed substantial differences in embodied energy with monolithic concrete having an embodied energy 75 times greater than AAC.
- When considering the estimated construction time for a 100 sq. ft room, red bricks required the longest time, while Mivan construction required the least.
- Mivan technology offered faster construction of buildings compared to traditional masonry work, particularly for taller structures.
- Red bricks exhibit moderate embodied energy, contributing to resource depletion, emissions, and waste.
- While AAC blocks have lower embodied energy, they still contribute to emissions and waste.
- Monolithic concrete, despite its quick construction time, presents the highest embodied energy, significant environmental impact, and sustainability challenges.
- Hence, AAC blocks offer a better balance between embodied energy and construction time than red bricks and monolithic concrete.
Suggestions
- India has significant untapped potential for innovative building materials.
- Interdisciplinary collaborations with sustainability experts to delve deeper into integrated design and optimise strategies like building orientation, Window Wall Ratio (WWR), U-value (rate of heat transfer) of walls, roofs and window assemblies, glazing performance, active cooling systems, etc., can unlock the potential for a sustainable built environment.
- The construction industry’s preference for Mivan as a prime building material raises sustainability concerns, including high embodied carbon and thermal discomfort.
- Sustainable construction requires innovation from building materials manufacturers to develop cost-effective, scalable, durable, fire-resistant solutions with superior thermal performance and climate resilience.
Conclusion
- In conclusion, the journey toward sustainable construction is challenging but essential for a greener future.
- By re-imagining construction design and practices, manufacturing innovative walling materials, and fostering a culture of sustainability, we can create resilient and energy-efficient structures that align with environmental goals and significantly improve the quality of life for the masses.