Tuesday, Apr 12, 2005
India, China to study feasibility of FTA
By Our Special Correspondent
NEW DELHI, APRIL 11. Encouraged by an impressive growth in Sino-Indian trade, China today spelt out a five-point agenda envisaging reduction in trade barriers and enhancement of multilateral cooperation, to boost bilateral trade to the $30 billion level by 2010 and enhance investment.
"We have set an objective (in the joint statement) to increase the two-way trade from $13.6 billion at present to $20 billion by 2008 and we plan to take it to $30 billion by 2010," the Chinese Premier, Wen Jiabao, said while addressing Indian and Chinese business leaders at the India-China Business Cooperation Conference organised by the Federation of Indian Chambers of Commerce and Industry (FICCI), the China Council for the Promotion of International Trade (CCPIT) and the Confederation of Indian Industry (CII).
The two countries had also agreed to go in for a joint feasibility study for a bilateral Free Trade Agreement, Mr. Wen said.
To attain a quantum jump in economic and business relations between the two countries, Mr. Wen favoured removal of trade barriers and strengthening of cooperation in steel, oil, machinery and other basic industries, high tech industries such as space, maritime, IT, new materials technology and facilitation of trade in goods and services.
The Chinese Premier also called for investments in both countries through the setting up of joint ventures and infrastructure development and emphasised the critical need for the two countries to cooperate in multilateral trade fora like the WTO. In fact, the two sides have also agreed to work together in energy security and at the multilateral level at the WTO to support an "open, fair, equitable and transparent rule-based multilateral trade system", according to the joint statement signed by the Prime Minister, Manmohan Singh, and Mr. Wen.
Export basket
The Union Commerce Minister, Kamal Nath, said China was poised to become India's largest trade partner in two-three years, next only to the U.S. and Singapore. "From $1 billion annual trade a few years ago, India-China trade is clocking over $1 billion a month to touch $13.6 billion in 2004-05," he said.
Mr. Nath suggested change in the composition of the export basket in favour of high value items like drugs and pharmaceuticals and services like IT, tourism and banking. Earlier, Mr. Wen said India could increase its investment in China in IT, space technology and science and technology. China could invest in biotechnology, computer hardware and telecom hardware.
On multilateral trading front, Mr. Nath said during his discussions with his Chinese counterpart, Bo Xilai, last night, it was indicated that the two countries would strongly oppose attempts to divide developing nations by categorising them as advanced developing countries, along with South Africa and Brazil.
China positively evaluated market access for Indian rice to the Chinese market and will launch as early as possible the risk analysis procedure of Indian rice in accordance with relevant Chinese laws and regulations, the joint statement said. Regarding the energy sector, the joint statement said India and China agreed to cooperate in the field of energy security and conservation, including, among others, encouraging relevant departments and units of the two countries to engage in the survey and exploration of petroleum and natural gas resources in third countries.
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