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Australia keen on comprehensive free trade pact
G. Srinivasan
Mr Simon Crean
Canberra, Nov. 4
Australia is seeking a comprehensive free trade agreement (FTA) with India covering agriculture, manufacture and services and investments so that efficiency gains could be ensured, the Australian Minister of Trade Mr. Simon Crean said.
Interacting with a group of Indian journalists at his Parliament Office here recently, Mr. Crean said that "it is far better to be more comprehensive in one's ambition and see what the particular difficulties are. But I think the better framework to approach the negotiations is not just looking into the difficulties rather to the opportunities".
He said among the six countries in the sub-continent India has a well-developed and an advanced manufacturing base and half of the Indian economy is accounted for by services.
He said that agriculture is a sensitive issue but Australia has successfully forged an FTA with Association of South East Asian Nations (ASEAN) which consist of countries of subsistence agriculture and different level of development. "Sensitivities can be sensibly addressed", he said.
Asked when the feasibility study would be ready, he said "it is a matter for decisions by the ministers, following the receipt of the feasibility study". The present global economic downturn provides an opportunity as people "are seeking access to capital -- for expansion, to try and build component parts to the world economy and this accords with the high economic growth of the Asian region".
"If we can get through the uncertainty surrounding the global economic crisis, the surest way is demonstrating our commitment to expand trading opportunity for which we have to build components", Mr. Crean said.
Negative List
To a specific query as to whether the FTA would provide for negative list by India, Mr. Crean drew the parallel with Australia-Asean FTA and India's forthcoming FTA with Asean to underscore the point that these could be sorted out during negotiations after the feasibility study is in place.
When his attention was drawn to behind-the-border protection being erected by countries, he said that Australia had no restrictions on foreign banks as the banking system was strong and supervisory regulations were in place with prudential arrangements. "We have to ensure that the best world practices are followed" in the services sector so that unnecessary fears and protectionist barriers could be removed.
Trading Opportunities
Mr. Crean suggested that countries should use the global financial crisis to expand trading opportunities and "if the globe is looking for component-building it could be well-served by concluding the Doha Round. It was that which gives a significant impetus to world trade".
World trade has grown historically at three times the pace of world output-with each multilateral trade round providing an impetus to world trade growth. But in the last few years, the multiplier of trade expansion has shifted and "we need to take the current crisis to convince countries to push for concluding the Doha Round". He however ruled out the launch before the end of the Presidential election in the United States though the modalities could be firmed up before the end of the year. He said the special product mechanism issue on agriculture could be resolved technically.
Asked about supply of uranium to India by Australia, he said the Labour Party stand is that "we will not supply uranium to countries that are non-signatories to nuclear non-proliferation treaty".
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