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India should declare sanctions against U.S.: Canadian Minister

By R. Gopalakrishnan

James Scott Peterson, Minister of International Trade, Canada. — Photo: Vino John

CHENNAI, APRIL 8. India should declare sanctions against the United States for its failure to repeal the ``Byrd Amendment'' which had been struck down as illegal by the World Trade Organisation, says James Peterson, Canada's Minister of International Trade. India is a co-complainant in the case in the WTO against the U.S. on the issue of payment of anti-dumping duty proceeds to domestic industries.

Canada, one of the two main complainants in the WTO against the Byrd Amendment, has last week announced trade sanctions against the U.S. in the wake of the latter's failure to meet the deadline imposed by the appellate and other tribunals of the WTO for repealing the U.S. domestic law. ``I hope India will similarly issue sanctions,'' he said, adding, ``if the WTO is to work, all parties must play by the rules,'' he said replying to questions in an exclusive interview with The Hindu here today.

Mr. Peterson said the ``preferred option'' would be for the U.S. to repeal the impugned law (which is perceived to give double benefit to U.S. domestic industries, viz, once by way of protection against dumping by foreign exporters and a second time by way of access to free funds from the exchequer). However, as long as the Byrd Amendment was not repealed, it was only fair that affected trade partners of the U.S. were allowed to retaliate by way of sanctions, he added.

Mr. Peterson expressed ``disagreement'' with the censorial approach towards the proliferating free trade agreements (FTAs) displayed by the Peter Sutherland report of the WTO, issued early this year. ``There is no doubt that priority should be given to the Doha Development Agenda of the WTO, since that is the only way of tackling the high agricultural subsidies of the U.S. and the European Union (EU). At the same time, trade liberalisation is a must and bilateral and regional agreements that do provide for liberalisation of trade can be positive [in their impact],'' said Mr. Peterson, whose own country is a founder-member of the North America Free Trade Agreement (NAFTA, including the U.S. and Mexico) and is negotiating, along with the U.S., a Free Trade Agreement of the Americas (FTAA) embracing a large number of South American countries.

``NAFTA has proved beneficial for all its members,'' he said, adding that in the case of India, Canada would ``pursue a Foreign Investment Protection Agreement.'' When pointed out that India had a liberal democratic system that was unlikely to warrant the exercise of provisions of such an agreement, he said the need for the agreement arose from the possibility that the current framework of the Doha agenda might not make available required guarantees to investors.

While recognising the specifics of India's agricultural sector such as small size of land holdings and a large population dependent on it for livelihood though its contribution to the gross domestic product was less than 25 per cent, Mr. Peterson said cooperation in the WTO between India and countries such as Canada and Australia was necessary for ensuring reduction of U.S. and EU farm subsidies.

``As I told Kamal Nath [Minister for Commerce], successful conclusion of the Doha process will need that we are alive to certain sensitivities of member-nations.''

Mr. Peterson said the much-talked-about Indo-Canadian agreement on co-production of films ``is not far off.'' It had been decided that initially a limited number of projects would be covered for 18 months before expanding the programme. There were also problems on the ``distribution front,'' he added.

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