The Hindu Business Line : `India to consider allowing FDI from Bangladesh'

THE MINISTER of State for Commerce and Industry, Mr Jairam Ramesh, with the Leader of Task Forces Delegation from Bangladesh, Mr Mohammad Ali, in Kolkata on Tuesday. — A. Roy Chowdhury

Kolkata , June 20

India must allow foreign direct investment from Bangladesh, though with adequate safeguards, even as "we are seeking to push significant investments into Bangladesh."

Commenting on the recommendations of the Task Force (under an MoU between Federation of Bangladesh Chambers of Commerce and FICCI) on raising Indian investments in Bangladesh, Mr Jairam Ramesh, Union Minister of State for Commerce & Industry, said that "we will reconsider the Bangladesh FDI issue again. The ban, I think, should be lifted."

Favouring a case by case approach, and not FDI on the automatic route for Bangladesh, he said the source of funds has to be known, as the concerns over terrorism still remain.

Briefing newspersons after addressing the second meeting of the India-Bangladesh Task Forces, organised by FICCI, Eastern Regional Council here on Tuesday, the Minister said, "there is no logic in seeking more Indian investments while maintaining a ban on FDI into India from Bangladesh".

The Task Forces pertained to areas such as Bilateral Trade, Raising Indian investments, Trade-related Infrastructure, Removal of Trade Disputes and Non-Tariff Barriers.

Pointing out that the Government's response to the various recommendations of the Task Forces (as many as six) will be made known within a week or so, he said it was a pity that the Tatas' proposal for major investments had got stuck on the issue of reciprocal investment protection. It would have helped Bangladesh reduce its trade deficit greatly through the buybacks.

Acknowledging the strong export performance of Bangladesh during 2005-06, and projecting a nearly $ 300 million exports into India, he said the Government's response for duty-free access to 16 items, with a minimum value addition of 20 per cent, as sought by the Bangladesh side, would be made known within a week's time.

According to the Minister, the Government would be ready with its response at the Indo-Bangla two-day Joint Working Group meeting in early July at Agartala.

The list includes 11 items such asfish and fish products, edible oils, automotive battery, ceramic products, cosmetics and toiletries, electrical copper wire, jute & products, Melamine, leather & products, pharmaceuticals and footwear. It also includes five items where raw materials have to be imported from India, processed in Bangladesh and exported back to India.

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