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Commerce Minister complains of ‘sledging’ in trade talks

Commerce Minister Nirmala Sitharaman dismissed allegations that India’s “negative and protectionist” approach in FTA talks was leading to delays in pacts. File photo

Commerce Minister Nirmala Sitharaman dismissed allegations that India’s “negative and protectionist” approach in FTA talks was leading to delays in pacts. File photo

Sledging — or verbally bullying the opposition to obtain an advantage — happens not just in cricket but also in negotiations on Free Trade Agreements (FTA), Commerce Minister Nirmala Sitharaman said here on Sunday.

She was referring to the alleged attempts by certain countries to portray India as “obstructionist” in the FTA talks.

Speaking at an event organised by the think-tank Research and Information System for Developing Countries, the Minister dismissed allegations that India’s “negative and protectionist” approach — of not agreeing to eliminate duties on most goods — was leading to delays in pacts.

Ms. Sitharaman said the delays were instead due to India’s partner countries opposing its ‘ambitious offers’ in services and investment.

Talks are under way for FTAs with Australia, European Union, as well as for the Regional Comprehensive Economic Partnership or RCEP among 16 Asia-Pacific nations, including India.

Owing to its strength in services trade, India has been pitching for removal of restrictions on temporary movement of skilled workers in all these FTAs, on a reciprocal basis.

Support from China This proposal, for instance, had even got China’s support in the RCEP talks, official sources said. However, it had been turned down in separate FTA talks by Australia, the EU and some RCEP members as they feared that Indian workers would displace the locals.

Instead, countries such as Australia and the EU want India to eliminate tariffs even on sensitive items in agriculture (eg: wheat) and industry (automobiles) as part of the respective FTAs.

Ms. Sitharaman said “India will not yield” to such pressures.

During the recent 12th round of RCEP negotiations in Australia, India objected to attempts by some countries to project it (India) as a “laggard”, the sources said.

India also pointed out that it had made better offers than the other RCEP members on temporary movement of skilled workers and investment.

Though India asked other RCEP members to make matching offers, they did not do so, the sources said.

They said India also cited its foreign investment reforms and contrasted them with investment curbs even in certain developed nations who are RCEP members to prove that it (India) was not “defensive” in its approach. Following this, all RCEP members agreed not to disclose specifics of the negotiations to the media to ensure that the negotiations progressed peacefully.

'India will not yield to pressures'

Commerce Minister Nirmala Sitharaman on Sunday said countries such as Australia and the EU want India to eliminate tariffs even on sensitive items in agriculture (eg: wheat) and industry (automobiles) as part of the proposed Free Trade Agreements. However. Ms. Sitharaman said, “India will not yield” to such pressures.

Speaking at an event organised by the think-tank Research and Information System for Developing Countries here, she hit out at the protectionist measures of many developed nations.

Without naming any country, she referred to protectionist measures of many in the G20 (or the world’s 20 leading economies) and said if India (also a G20 member) took any measure they (the rich nations) perceived to be negative, they went on a campaign to brand India protectionist. “But if they [rich countries] take protectionist measures, they don’t want to talk about it,” she said.

Ms. Sitharaman said the “huge trade-distorting” agricultural subsidies of rich nations had not yet been properly discussed at the World Trade Organisation. She also referred to subsidies “given by China to its industry” and said this was hurting Indian manufacturers in sectors including steel.

Competitive devaluations

In the backdrop of competitive devaluations of currency by several countries including China to boost their exports, she cited the persisting contraction in India’s exports and said she personally felt the Indian currency needs to be devalued a bit. However, she added that it was up to the RBI to take a final call.

Owing to its strength in services trade, India had been pitching for removal of restrictions on temporary movement of skilled workers in all the proposed FTAs, on a reciprocal basis.

This proposal, for instance, had even got China’s support in the RCEP talks, official sources said. However, such “ambitious” offers by India had been turned down by Australia (in the India-Australia FTA talks), the EU (in the India-EU FTA talks) and some RCEP members (in the RCEP) as they feared Indian workers would displace the locals. During the recently held 12th round of RCEP negotiations in Australia, India objected to attempts by some countries to project it (India) as a “laggard”, the sources said. India also pointed out that it had made better offers than the other RCEP members on temporary movement of skilled workers and investment. Though India asked other RCEP members to make matching offers, they did not do so, they said.

India also cited the foreign investment reforms made by it and contrasted it with investment restrictions even in certain developed nations who are RCEP members to prove that it (India) was not “defensive” in its approach. Following this, all RCEP members agreed not to disclose specifics of the negotiations to the media to ensure that the negotiations progressed peacefully, they said.

Trade with New Zealand

K. Venkataramanan writes from Auckland:

Asked about the progress in the FTA negotiations with New Zealand, Preeti Saran, Secretary (East) in the Ministry of External Affairs, said: “We would look at what is of positive interest to us.” New Zealand’s perception was that in their experience, more investments were made where FTAs were signed. However, India was focussed on bilateral trade. “Beyond the FTA, there is our interest in attracting investment.”

Corrections and clarrifications:The article has been edited for an error


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Printable version | May 23, 2022 3:38:45 am | https://www.thehindu.com/news/national/Commerce-Minister-Nirmala-Sitharaman-complains-of-%E2%80%98sledging%E2%80%99-in-FTA-talks/article60365118.ece