Date:10/11/2006 URL: http://www.thehindubusinessline.com/2006/11/10/stories/2006111003791000.htm

Back `Industry must brace up for FTA talks'

Our Bureau

New Delhi , Nov. 9

The Indian industry will have to brace up for the Free Trade Agreement negotiations and not wait for domestic reforms to prepare them for the big change, said the Commerce Secretary, Mr G.K. Pillai, at a session on `Free Trade Agreements: Building strategic partnerships' organised by the Confederation of Indian Industry on Thursday.

"It is FTAs that will drive the domestic reforms, and not vice versa," he said.

The Secretary said the Government is conducting a series of FTA negotiations with different countries, including Japan, Korea and Australia. Talks with the EU are also expected to start in next March.

Less flexibility

The real challenge, he said, is negotiations with the developed countries, where there is less room for flexibility. "The industry must look at the timeframe such negotiations will take. Discussions with the EU may go on for two years and implementing will take another seven-eight years. We are looking at 2015-2018. Once the FTA is implemented, there will be 90 per cent tariff elimination and duties will come be zero."

Mr Pillai said the industry will have to perfect its testing mechanism, do thorough research, look at the infrastructural needs and learn the art of not importing any goods. Issues related to services and non- tariff barriers also need to be tackled.

He assured that the Government will engage with the industry in a big way on the FTA negotiations and wanted the industry to conduct sectoral studies for the same. "We need a position paper from the industry," he said.