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EU woos Indian industry associations

Ranvir Nayar in Paris

Encouraged by the response that it has received from the Indian industry, the European Union has now decided to work with the industry associations more closely as the deadline for the start of a new round of the World Trade Organisation talks approaches.

"The Indian industry now seems fully awakened to the advantages that the WTO system has brought to them. They are also aware that if they want to make the most of the new round of WTO, they must be in it and in it forcefully, rather than watching it from the sidelines and letting other countries decide their agenda," says a senior official of the European Commission.

The EU has, over the past few months, held several rounds of discussions with the Indian industry associations like the Confederation of Indian Industry and the Federation of Indian Chambers of Commerce and Industry.

In fact, FICCI was keen to have Leon Brittain, one of the commissioners of the EC and the man responsible for framing the EU's policy on WTO issues, address a meeting of FICCI in London on June 11. However, the speech has now been called off, since the Indian Industries Minister Sikandar Bakht apparently had some reservations about sharing a platform with Brittain.

Yet, the EC is determined to continue the dialogue it has been having with the Indian industry and, indeed, to step up the gas as the deadline approaches. The official level talks around the new round -- or the Millennium Round as the EC likes to call it -- are set to commence in September, with the ministerial meeting scheduled for December.

The EU has been disappointed by the "rigid" stand taken by India, questioning most new areas that the EU and other industrial countries would like to include in the negotiations. In fact, the visit of Brittain to India in April was with the sole item on the agenda, to get India to change its stance on the new round, since India is one of the few countries that is openly and vehemently opposed to the new round.

"At the same time as his India visit, Brittain had also visited other Asian countries like Indonesia, Malaysia and Pakistan. All of these countries, whose economic conditions are much worse than India, were in favour of the new round. But the Indians remained stuck where they were. They don't realise that they cannot hold the world back and if India does not participate actively, it will stand to lose tremendously, since it can derive huge benefits by negotiating actively," an EC official told Rediff On The NeT in Brussels recently.

The Indians maintain that it is too early for a new round, since most agreements of the first round are yet to come into force and so their impact hasn't been analysed. India wants to conduct negotiations evaluating the success of the previous round, before plunging into a new round.

The EC, however, denies it is playing the Indian industry against the Indian government by conducting talks with the industry associations.

"We are simply having a dialogue with the industry to see what they feel. And there is no question of using these talks to play the industry against the government, since the two work very closely and the government's position is influenced to a large extent by the industry. In several areas, we find the industry to be in total agreement with the government," the EC official said.

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