Industry & Economy
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Economic Survey
Immediate revival of WTO talks sought
Our Bureau
New Delhi
,
July 7
MULTILATERAL trade negotiations under the aegis of the World Trade Organisation (WTO) need to be revived on an urgent basis, according to the Economic Survey for 2003-04.
The Survey has held that a successful conclusion to the Doha Development Agenda could contribute to a stronger and more even expansion of world trade and sustained global economic growth.
With the strengthening of global recovery, the Survey noted that the prospects for growth in global output and trade in 2004 have brightened and that the expected robust pick up in global trade is likely to contribute to the overall growth of the Indian economy.
In particular, the Survey has highlighted that the impressive increase in imports of capital goods bolsters the hope of accelerated investment activity in 2004-05.
At the same time, the Survey also held that significant downside risks to the growth of the Indian economy persist. These include continuing firmness in global oil prices, volatility among major currencies and the danger of interest rate hikes in developed countries.
It highlighted the relevance of efficient macro policies to carefully manage the impact of a potential global transition from low interest rate and currency imbalances to a more sustainable regime.
On the foreign exchange reserves front, the Survey noted that the comfortable reserve position provides an opportunity towards deepening of trade reforms and other administrative measures.
While acknowledging that trade liberalisation is likely to counter some of the upward pressure on the exchange rate of the rupee, the Survey has held that the current exchange rate policy of focusing on managing volatility with no fixed rate target, while allowing the underlying demand and supply conditions to determine the exchange rate movements in an orderly way, has stood the test of time.
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