By Emma Farge

GENEVA (Reuters) - Countries and environmental groups voiced concern and disappointment on Tuesday after a draft treaty to cut fishing subsidies failed to pass, with China calling for major changes in how countries negotiate at the World Trade Organization.

The talks, seen as critical to helping over-fished stocks recover, have been going on for more than 20 years at the WTO with an initial package approved in 2022.

The second phase tackling some of the toughest remaining issues had been drafted for approval at a WTO meeting this week but was blocked by India which criticised what it called the treaty's "significant shortcomings" while seeking deeper carve-outs for developing countries.

As a result, the talks were downgraded from being up for adoption to merely being "discussed" by the WTO's 166 members, any one of which can block a deal under the body's rules.

"We are deeply concerned for our future work here in the WTO on these negotiations," said U.S. Ambassador Maria Pagan. On India's proposals, she said: "We find it difficult to understand the objectives of these papers when they re-introduce topics that have been debated and discussed repeatedly...," she said.

China, a major subsidiser, voiced deep disappointment that it had not been adopted. "The fish and this planet cannot wait any longer," said Ambassador Li Chenggang, who did not name India but referred to multiple failures of these talks "due to the same or similar reasons".

"We need to think about how to get out of this dilemma ... Let's change. No reform, no success," he said.

Environmental groups also expressed regret.

"The longer we wait, the more fishers are hurt by damaging subsidies that deplete the fish populations that coastal communities depend on," said The Pew Charitable Trusts's Ernesto Fernández Monge.