The Hindu : National : Lift trade barriers, U.S. told

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Friday, Jun 23, 2006

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Lift trade barriers, U.S. told

India must become America's largest economic partner, says Kamal Nath

Photo: AP

ENHANCING TRADE: U.S. Trade Representative Susan Schwab meets Commerce Minister Kamal Nath at her office in Washington on Thursday.

New Delhi: Commerce and Industry Minister Kamal Nath on Thursday asked the U.S. to remove all barriers in trade and services so that India can become its largest economic partner.

Mr. Kamal Nath said this while addressing the U.S.-India Business Council (USIBC) in Washington on the theme of "Enhanced U.S.-India Trade: The Way Forward."

India-U.S. merchandise trade stands at $ 25 billion and the services trade is estimated at $ 20 billion.

"The rate of growth is remarkable, but bilateral trade could be much more," he said. Mr. Kamal Nath said India's eight per cent GDP growth for the past three years is riding on a solid entrepreneurial base. "It is the manufacturing and industrial sector which offer the best opportunities for American investors."

Stating that centres of economic gravity would gradually but inevitably move eastwards from the Atlantic Ocean towards the Indian Ocean, the Minister said the gap between Asia and the West would get reduced.

Counsels compromise

The Minister later told a Washington forum on the Doha Round of global trade talks under the World Trade Organisation that the United States and the European Union needed to forge a compromise on agricultural trade to help break the impasse.

The compromise could come about particularly if the EU improves its offer on the table, he said.

``The EU must come forth with a better offer,'' he said, ahead of his trip next week to Geneva, where WTO ministers are to meet for crucial talks to hammer out a mechanism for further negotiations on such key subjects as tariffs on agriculture and industrial products.

The Doha Round, which was launched in 2001 in the Qatari capital, was meant to have been completed in 2004. Negotiators also missed their last deadline, April 30, for deciding on the mathematics of the final accord.

When asked how a US-EU compromise could forge a larger agreement among the 149 WTO members, he said: ``What EU offers in market access, (India will) do two-thirds of that.

``That's what we did in the Uruguay Round,'' he said, referring to the predecessor of the Doha Round of talks. ``Let the US extract what they can from the EU; we'll do two-thirds. No problem. I want that benchmark,'' he said.

Agricultural subsidies

Developing countries want developed countries to eliminate agricultural subsidies in exchange for allowing more market access in other areas of trade.

India is a leader of the G20 forum of major developing countries aimed at enhancing dialogue with the Group of Seven industrialised nations.

The United States says it is willing to cut farm, manufacturing and other subsidies, provided the EU offers bigger cuts in farm import duties and India and other developing economies scale back tariffs on industrial goods.

But the EU says the United States is offering too little and must make further concessions to jump-start the deadlocked negotiations.

Deadline

World Trade Organisation Director General Pascal Lamy has set an end-of-June deadline for countries meeting in Geneva to agree on basic formulas for cutting farm subsidies and reducing agricultural and manufacturing tariffs that have eluded negotiators in more than four years of talks. — Agencies

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