India, EU Ink Pacts to Boost Trade; Vow to End WTO Row

Author: 
Nilofar Suhrawardy & Agencies
Publication Date: 
Sun, 2003-11-30 03:00

NEW DELHI, 30 November 2003 — India and the European Union yesterday inked two trade agreements and pledged to patch their WTO differences, while New Delhi formally threw in its lot with the EU’s Galileo satellite navigation system.

A statement issued at the end of the fourth India-EU Summit in the capital New Delhi said both sides had also agreed to increase cooperation against terrorism and intensify steps to promote stability in Afghanistan.

The EU in the joint statement welcomed this week’s cease-fire in Kashmir between the Indian and Pakistani armies and expressed hope the move would lead to dialogue to resolve the Kashmir issue.

One of the agreements, signed by Indian Foreign Minister Yashwant Sinha and EU’s Commissioner for External Relations Christopher Patten, paves the way for the implementation of the EU-India Trade and Investment Development Program.

The 14 million euro ($16.6 million) program envisages major assistance to Indian exporters to meet strict EU norms.

The other, on customs cooperation, aims at facilitating trade by ensuring the removal of obstacles in the movement of goods between the two sides.

Bilateral trade between India and the EU was 26.96 billion euros in 2002, with the European bloc receiving 26 percent of Indian exports.

Both sides Friday promised to double bilateral trade to 50 billion euros by 2008 by knocking down trade barriers.

The joint statement said India and the EU had “reiterated (their) commitment to work toward further strengthening the multilateral trading regime under the World Trade Organization (WTO).

“We are committed to the successful conclusion of the current Doha round of negotiations as also confirmed by the ministers of the WTO at Cancun,” the statement said.

A five-day WTO ministerial conference in Cancun, Mexico, broke down Sept. 14, riven by deep divisions between poor and rich nations.

World trade ministers had agreed in Doha, Qatar, in November 2001 that a final agreement should lower all forms of agricultural export subsidies with a view to eventually phasing them out.

Earlier yesterday, Indian Prime Minister Atal Behari Vajpayee told the meeting WTO talks could be nudged back on track if developed countries changed their stance on trade-distorting farm subsidies.

Millions of agriculture-dependent people in developing countries were being undercut in the global marketplace by billions of dollars worth of subsidies being doled out by rich nations to their farmers, he said.

“I think we should draw the right conclusions from the outcome of the Cancun ministerial meeting. We have to recognize that the developmental concerns of the poorer countries of the world are taken into account,” he said.

EU Commission President Romano Prodi agreed that it was time to move forward by learning from the Cancun debacle.

“We need a helping hand to push the Doha process. We should reflect on the sticking points at Cancun. The outcome was not satisfactory for us nor for you,” Prodi told the meeting.

The G-20 group of nations will try to find ways to revive the stalled WTO talks at a meeting in Brazil on Dec. 12 with European Union Trade Commissioner Pascal Lamy, Indian Commerce Ministry official S.N. Menon told the meeting on Friday.

The joint statement also said India had agreed to participate in the Galileo program “recognizing the vital importance of satellite navigation and positioning of our economies.”

Indian officials said New Delhi would soon pick up a $350 million (300 million-euro) stake in the 3.2 billion euro European satellite project, meant to rival the Global Positioning System run by the US Defense Department.

The meeting was clouded by the sudden cancellation of Italian Prime Minister Silvio Berlusconi’s visit to India as the head of the European delegation on Friday due to illness.

Vajpayee yesterday said that Berlusconi was “missed” at the summit but that he had assured New Delhi that he would visit India as soon as possible.

India and the European Union sought a key role for the United Nations in restoring stability in Iraq as Patten warned that an Iraq in shambles would be disastrous.

The joint statement said both sides “stressed the importance of the central role played by the United Nations in the restoration of peace and normalcy and reconstruction and rehabilitation” of Iraq.

India and the EU “emphasized the urgency of the adoption of a clearly laid out political process within a realistic time-frame ... to allow the Iraqi people to determine their own political future and retain effective control of their economic resources.”

A number of EU members, notably France and Germany, have called on Washington to lay out a timetable for returning power to the Iraqi people.

But the United States also has the support of a section of European countries — Britain, Spain and the EU’s current president Italy — who have sent troops to Iraq as part of the US-led effort to restore peace there.

Patten said in an interview published yesterday in the Hindu newspaper that an unstable Iraq would act as a magnet for terrorists. “My own view is that we have to see a transfer to a credible set of Iraqi institutions as soon as possible,” he said.

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