Financial Daily from THE HINDU group of publications
Friday, Jun 07, 2002
Financial Daily from THE HINDU group of publications Friday, Jun 07, 2002 |
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Industry & Economy
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Foreign Trade Concessions to Pakistan -- India-EU trade talks likely next month Our Bureau
NEW DELHI, June 6 INDIA is expected to hold a third and final round of consultations with the European Union (EU) during the second week of July regarding the latter's concessions to Pakistan under the Drug Control Window of Generalised System of Preferences (GSP). This was stated by Mr S.N. Menon, Additional Secretary, Ministry of Commerce, at a seminar on `Textile: Doha, 2004 and Beyond' organised by the Confederation of Indian Industry (CII) here on Thursday. "On this issue, we have completed two rounds of consultations with the EU which unfortunately have failed. In case the final round of consultation fails, we will have no other alternative but to take the case before the Dispute Settlement Body of the WTO for the constitution of a panel for adjudication," Mr Menon said. He pointed out that the zero duty market access under the special arrangement would make it cheaper for EU importers to buy products from Pakistani sources than from Indian exporters on which customs duty will be applicable. The provision of a separate trade package to Pakistan by the EU enables 15 per cent quota hike with the textile sector and zero duty facility for all non-graduated products under the EU GSP scheme. Of Pakistan's total exports of Euro$2.66 billion in 2000 to the EU, trade worth E$ 1.4 billion (including E$ 642 million for textiles) has already graduated out of the GSP. The trade covered by GSP is E$ 1.45 billion out of which clothing constitutes E$ 1.06 billion. "Therefore, it is expected that Pakistan may dramatically improve its utilisation of GSP coverage following the concessions given by the EU under the Drug Control Window of GSP. It is apprehended that India would stand to lose trade substantially in the clothing sector where the applicable duty for our items is 10 per cent," Mr Menon said. Stating that the scenario emerging from the performance of India's clothing exports is not encouraging, Mr Menon said that India has not been able to keep pace with the rate of market expansion. New players such as Mexico, Honduras, Romania, Bangladesh and El Salvador are posing a threat to India's position that could further exacerbate in the coming years, he said. On the decision taken on the "growth-on-growth" provision at the Doha Ministerial conference, Mr Menon said that there has been virtually no progress in this matter as some developed countries have, as a delaying measure, sought detailed statistics regarding the trade in this sector. The Council for Trade in Goods had been mandated to examine this issue and make recommendations to the General Council by July 31, 2002 for appropriate action. "Unless good faith is shown in this regard, it is likely that the relevant Doha decision will remain a mere pious intention without achieving anything concrete in trade terms," Mr Menon said. India, along with certain other textiles exporting countries, has been repeatedly emphasising the lack of progressive integration of the textile trade.
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