The Telegraph (Calcutta) | 9 January 2008
Free trade with US in the works
OUR SPECIAL CORRESPONDENT
New Delhi, Jan. 9: Union commerce minister Kamal Nath today said India was in talks with the US and Canada for free trade agreements.
“Bilateral trade agreements are currently in the pipeline with at least 10 potential partners ranging from the Asean (Association of South East Asian Nations), the EU, the US and Canada,” the minister said at the Pravasi Bharatiya Divas here today.
There was a mixed response from industry, with the Federation of Indian Chambers of Commerce and Industry (Ficci) and the Associated Chambers of Commerce and Industry of India (Assocham) offering contrasting views.
Ficci trade analyst Anjan Roy said a bilateral free trade agreement with the US would be good for India and not affect Indian manufacturing units.
“The products from the two countries would not be competing against one another and would provide a window of options for the consumers,” he said.
However, Assocham secretary-general D.S. Rawat said India should move cautiously in negotiating a free trade agreement with the US as such a pact could affect the interest of domestic industry.
On foreign trade, Nath said that “currently, our global economic engagement is $450 billion and we have a target to take it to $550 billion”.
Exports to the US for the first half of 2006-07 stood at $18.9 billion, which is an increase of 8.72 per cent on a year-on-year basis and makes up 22.57 per cent of total exports.
Imports from the US during the period under review was $11.7 billion, an increase of 24 per cent.
At the recently held India Economic Summit here, David Dreier, a representative of Republican Party from California to Congress, said he intended to introduce a legislation on talks for an FTA.
India already has FTAs with Singapore, Sri Lanka and Thailand. The country is at an advanced stage of negotiating a bilateral trade and investment agreement, similar to a free trade pact, with the EU and the Asean.
There is also a possibility of similar agreements with Japan and China.
Nath said the government could import more cement to bridge the gap between the demand and supply of the commodity.
“We are reviewing cement prices from time to time. While cement companies can make profits, profiteering cannot be allowed,” he said.
Nath’s statement comes days after the Tamil Nadu government threatened to take over cement companies if private producers failed to check prices.
The Monopolies and Restrictive Trade Practices Commission recently found 44 cement companies guilty of cartelisation under the aegis of the Cement Manufacturers’ Association.