India, Gulf states to kickstart talks on free-trade pact
India, Gulf states to kickstart talks on free-trade pact
HUMA SIDDIQUI & AMITI SEN
Saturday, November 05, 2005
NEW DELHI, NOV 4: Discussions on a possible free trade agreement (FTA) between India and the Gulf Cooperation Council (GCC) are gaining momentum with the two sides deciding to meet early next year to thrash out important issues like rules of origin (ROO) and differential tariffs which are key to such agreements.
Officials from India and the GCC, accompanied by big business delegations, will meet on January 28-29 2006 in Muscat, Oman, in a bid to kick-off intensive negotiations which could lead to an early signing of the FTA.
GCC member countries include Saudi Arabia, Oman, the United Arab Emirates, Kuwait, Bahrain and Qatar.
Speaking to FE, secretary, (East), ministry of external affairs (MEA), Rajiv Sikri, said, “Traditional trade and investment partners like the Gulf will always occupy an important place in our external relations.” He expressed hopes that negotiations on the India-GCC framework agreement on a FTA will help boost investment and trade.
Negotiations are slated to start on better banking arrangements, setting up an information channel on investment opportunities, avoidance of double taxation and a treaty to promote and protect investment among other issues.
The potential for industrial co-operation in areas like petroleum and gas, petrochemicals, fertilisers, power, metals and pharmaceuticals has also been realised.
HR Mohey, Indian embassy charge d’affaires in Bahrain said as a group, the GCC is India’s second largest trading partner. It is the largest single origin of imports into India and the second largest destination for exports from India.
Bilateral trade rose to $18-20 billion in 2003-04, excluding oil and gas imports by India that are worth about $20 billion.
According to PHDCCI, about 16% of India’s total exports are now going to the Middle East, while 8% of India’s total imports, not including oil imports, are from the same region.
Many Indian companies and banks in recent months have established themselves in the region which include ICICI Bank, the Dredging Corporation of India and the UTI Mutual Funds.
