The Hindu : `Economic diplomacy crucial for India'

Online edition of India's National Newspaper
Thursday, Jan 22, 2004

Karnataka

Karnataka

`Economic diplomacy crucial for India'

By Our Special Correspondent

BANGALORE, JAN. 21. India's "economic diplomacy" has become more important now to protect and promote our commercial interests in an era of globalisation and to face the challenges and exploit opportunities thrown up by a fast integrating world, according to M.P. Gavai, Director, Investment and Trade Promotion, Union Ministry of External Affairs, here on Wednesday.

Addressing an interactive meeting with Indian commercial representatives in West Europe, organised by the Federation of Indian Export Organisations (FIEO) and the Union Ministry of Commerce, Mr. Gavai explained how integration of Indian's regional and bilateral free trade agreements had become important goals of economic diplomacy.

India was studying the possibilities for conducting trade and reaching economic agreements with China. There were prospects for economic cooperation with the Gulf Cooperation Council, and a trade agreement with Iran was under consideration. Framework agreements had been signed with the South African Customs Union and with the Andean community in South America, and these should lead to free trade agreements.

A strategic trilateral group — IBSA (India, Brazil, and South Africa) — had been formed. Indian companies had established joint ventures to get phosphates from Jordan and Senegal. Another initiative was aid diplomacy, and the Line of Credit of $ 200 million to Africa under the New Partnership for Africa's Development. This would bring long-term trade benefits.

Rajeet Mitter, Joint Secretary, Union Ministry of Commerce, said SAFTA (South Asia Free Trade Agreement) was expected to come into being by 2006. As part of India's "Look East Policy", negotiations for free trade agreements had been concluded with Thailand, and negotiations were going on with Singapore for a comprehensive economic cooperation agreement. All these would lead to sharp reduction in tariffs for both sides.

Hamid Ali Rao, Deputy Chief of Mission in Austria, said the major crystal manufacturer, Swarovski, with boutiques in Bangalore and other cities, was planning to set up a manufacturing and export unit in India.

M. Rafeeq Ahmed, FIEO President, welcomed the participants.

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