Return
to Story Page
To print: Select File and then Print from your
browser's menu
Indian industry knows where the shoe pinches under the WTO regime. Yet, for reasons inexplicable, it or rather its representative organisations like the Confederation of Indian Industry (CII), took little interest in the shaping of tariffs and related agreements to which this country is a signatory. The initiative was left, principally, to the bureaucrats; this tribe in India fundamentally consists of generalists, unfamiliar with the nitty gritty of international trade and law. The least Indian industry could have provided is a think tank to aid the officials sent for trade negotiations. There was inadequate realisation that the pace of India's external liberalisation would not be set by New Delhi but accelerated under heavy pressure from the industrialised countries. The textile agreement is an example of the kind of lopsided arrangement India acquiesced in; the bizarre front-loading in favour of the West (with no trade-offs benefiting this country) would not have been possible if hard headed business hadkept a wary eye on the negotiations.
The CII seminar of September 16, sponsored by Reliance Industries and ITC, at which the impact of WTO on various industries was made, is a turning point. For the first time, industry put forward WTO-compatible demands before the bureaucracy for negotiation at Seattle. It was silly to have accepted US import duties on textiles (15-16 per cent) blinded by zero import duties on jet engines; the latter( of no export interest to India) brings down the average level of US import duties but this is little consolation for India's textile exports. It is astounding that anti-dumping duties levied up front against exports of developing nations go unchallenged. The West uses anti-dumping measures frivolously to duck legitimate competition. Indian industry's demand for compensation in cases where dumping is not established after investigation must be in the forefront of demands at Seattle. It is not protectionist to demand that India should switch from ad valorem to specific dutiesin times of cyclical price falls. Japan uses specific duties and the US ad valorem-cum-specific duties against petrochemicals.
There is loose talk in this country of bringing down import tariffs to East Asian levels. This, on top of the crash reductions in duties by 50-100 per cent, is a prescription for disaster. Indian industry is right in demanding that US pressures for accelerated duty reductions should be vigorously resisted--not for all time, but during a well-defined period. The proximity of the Seattle meet has sensitised Indian industry to its stake in WTO negotiations. But the economic bureaucracy must be willing to learn.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
------------------------------------------------------------
This story was printed from Net Express located at http://www.expressindia.com. Net Express provides a portal to India, with news from The Indian Express and The Financial Express along with sites on travel and tourism, the entertainment industry, the power sector, the environment and much more.
------------------------------------------------------------