India logical destination for Thai investment: Vajpayee

BANGKOK OCT. 10. Thailand can be India's "commercial bridge" to South-East Asia while India provides Thailand with a huge domestic market and a low-cost, high-skill manufacturing base, the Prime Minister, Atal Bihari Vajpayee, said today.

Addressing a business meeting of Indian and Thai chambers of trade and industry, Mr. Vajpayee said there were important convergences of interest and economic complementarities between India and Thailand.

"Thailand's acclaimed competence in infrastructure — including ports, airports, highways and urban amenities — match our growing requirements in these fields," he said.

"In the knowledge economy, India's software skills can usefully support the rapidly developing hardware capabilities of Thailand. Our growing skills in biotechnology can be combined to utilise the range of biodiversity in our two countries," Mr. Vajpayee said.

India was among the six countries with the ability to provide end-to-end capabilities in space — from design and fabrication, tracking and control, to launching of satellites. He wondered why these "complementarities" had not translated into performance. There was a similar mismatch between the potential and the reality in two-way investment figures — India, a net capital importing country, had invested about $1 billion in Thailand. The actual Thai investment in India was a paltry $70 million.

"Prime Minister Thaksin (Shinawatra) has talked about Thailand's desire to use the economies of speed to commercial advantage. With a market of one billion and the second largest skilled workforce in the world, India offers economies of scale. I would suggest that the ideal strategy is to link the economies of speed and scale. India should therefore be a logical destination for Thai investment," Mr. Vajpayee said.

Pointing to the free trade area framework agreement, he said there was a need to expand on the early harvest programme in the FTA, which envisaged immediate tariff reduction for some products.

The Prime Minister said: "I am aware that there will always be those who are not satisfied with the pace of our bilateral tariff reductions. Businessmen will find such measures too slow or too fast, depending on their interests.

"For some, tariffs can never be low enough; for others, they can never be high enough. It is therefore a delicate problem of balance. We will have to find a mutually convenient pace to move forward," the Prime Minister informed the business community.

Mr. Vajpayee said he was "happy" to hear from Dr. Thaksin that Thailand would reciprocate the offer made by India to Thai Airways for daily flights between Bangkok and the four metros of Delhi, Mumbai, Chennai and Kolkata as well as unlimited flights to 18 other Indian cities.

"You need to form strategic alliances to develop markets in our common neighbourhood. Bilateral economic relations will acquire a dynamic of its own, when they are driven by business interests. Governments will then no longer have to set targets for trade turnover," he said.

The Prime Minister was pleased at the "happy confluence" of India's "Look East" posture and Thailand's "Look West" strategy. "Our partnership is not solely economic. We are located astride the sea lanes for energy supplies from West Asia to markets in the East. Therefore, we have a common stake in peace, security and stability in this region," he said.