New EU Trade Chief Likely To Change The Nuances

Written by Malcolm Subhan | Updated: Aug 21 2004, 05:53am hrs
Indian exporters targeting the 25-nation European Union (EU) can expect a shift in its trade policy after November 1. That is when the EU will have a new trade supremo. Englishman Peter Mandelson, former secretary of trade and industry in Tony Blairs government, will replace the Frenchman Pascal Lamy as EU Commissioner for external trade.

In 2003, Indian exports to the then 15-nation EU stood at 13 billion euro, and imports at 14 billion euro. Exports of textiles and clothing alone came to 4.4 billion euro in 2002. They are expected to rise sharply from January 1 next, when the EU lifts its quota restrictions on imports.

Mr Mandelson is a supporter of the EUs Lisbon strategy, its 10-year project to become the most competitive and dynamic knowledge-based economy in the world. Achieving this goal requires better policies for the information society and R&D, as well as stepping up the process of structural reform for competitiveness and innovation.

In 1998, some two years before the EU launched its drive, Mr Mandelson, as trade and industry secretary, was behind the UK governments white paper Building the Knowledge Driven Economy. In other words, he can be expected to favour a move away from the labour-intensive sectors of manufacturing industry and towards the more capital-intensive, high-tech industries.

Although a committed socialist, like Mr Lamy, and a long-time member of the Labour Party, 50-year old Mr Mandelson is credited with having helped Prime Minister Tony Blair modernise his party.

Mr Mandelson is not the only newcomer to Brussels. Come November 1, the present 20-member European Commission, the EUs executive arm, leaves office, to be replaced by a new 25-member Commission. The interim Commission has just moved into the two top floors of a modern office block here to prepare its strategy for running the EU during the next five years.

This means that the commerce ministry will not be alone in keeping a watchful eye on developments in Brussels. So will Natwar Singh and the ministry of external affairs. This is because external relations commissioner Chris Patten will be replaced by former foreign minister of Austria Benita Ferrero-Waldner.

Austria clearly is delighted that its commissioner has secured one of the top jobs in the EC. In fact, Ms Ferrero-Waldner wanted the job of development commissioner, but was beaten to it by Belgiums former foreign minister Louis Michel, according to Belgian newspaper, Le Soir. A member of her department told the European Parliament recently that the external relations directorate will give top priority to strengthening and deepening EU-India relations.

The EU Council of Ministers is expected to endorse the ECs plans to create an EU-India strategic partnership, as set out in Commissioner Pattens paper of June 16. Hopefully, it will do so before the EU-India political summit at the Hague on October 13-14.

Even so, fears been expressed that the fifth EU-India summit may prove less effective because the EC will be represented by its outgoing president, Romano Prodi, and Mr Patten. The Commission, after all, is the driving force on the EU side for closer and stronger relations with India.

Perhaps the best way to counter these fears, and to ensure continuity in EU-India relations, is for Prime Minister Manmohan Singh to spend a day or two in Brussels before returning to New Delhi.