India announces $50-m line of credit for Malaysia

Kuala Lumpur, May 15: INDIA has announced a 50 million US dollars Line of Credit to Malaysia to double bilateral trade within three years and said it would review the hike in tariffs on palm oil imported from Kuala Lumpur.

Making the announcement at a business forum here, Prime Minister, Atal Bihari Vajpayee said his Government was offering the Line of Credit for giving an impetus to Indian exports, including industrial goods and projects, to Malaysia.

“If our ambitious objectives of expanding trade and investment ties are to be met, what we need is a close association between our two governments and our business organisations,” he said in his key-note address at the Malaysia-India Business Forum on “Enhancing Malaysia-India Partnership: A Shared Vision for the 21st Century”.

On palm oil, which is Malaysia’s largest export to India, Vajpayee said the decision on import tariffs for the commodity had been determined entirely in consonance with World Trade Organisations obligations.
“Just as Malaysia has to protect its palm oil plantations from falling prices, we have to take care of the interests of our own farmers who have experienced similar difficulties,” the Prime Minister said. However, guided by the considerations of strengthening solidarity with ASEAN friends, “We have now decided to review the import duty on palm crude,” he said, adding he had held detailed discussion with Malaysian leaders on the issue.

Vajpayee, accompanied by a 75 member Indian business delegation, told the forum that India would tackle the palm oil issue in a manner that would safeguard the interests of Indian farmers and yet facilitate import of palm crude for “our under-utilised refineries”.

Officials said India would be importing palm oil in a swap for a railway project worth Rs 8,500 crore to be undertaken by Indian railway construction company in Malaysia.

Vajpayee said the primary challenge before both governments would be to reduce the “awareness gap” about “exciting” business opportunities in the two countries.

Re-cognising that regional economic co-operation was an “important complementary dimension” of globalisation, he said Malaysia was India’s gateway to ten-member ASEAN’s market of half a billion, just as India offered to ASEAN a fast growing market of a billion people. (PTI)