India and China aims bilateral trade of US Dollar 20 billion
India and China have planned to raise their annual trade volume to $20 billion in three years from last year’s $13.6 billion. However, there is no immediate plan for establishing a free trade area (FTA) between the two countries that will be the largest in the world in size.
It was evident that the Chinese enthusiasm for an FTA, which in its conventional sense could mean lifting of duties and other barriers so that there could be free flow of goods between the two countries, was not shared by the Indian side. Official India as well as the industry sounded cautious in getting into such an FTA with China, which today strides the global markets as the ‘‘factory of the world’’.
The two sides agreed to explore possibilities spanning more areas and not just free trade in goods for a more balanced arrangement. No timeframe has been set for even this exploratory process.
At the meeting with business leaders, both Wen and commerce minister Kamal Nath hailed the 12-fold growth in the two-way trade — from $1 billion a year a decade ago to $1 billion a month now. But Wen noted that the present trade volume ‘‘is not even 5% of the potential’’ and announced that China aimed to boost trade with India to $30 billion annually in five years.
The two sides agreed to work together in energy security and at the multilateral level at the WTO to support an ‘‘open, fair, equitable and transparent rule-based multilateral trade system’’.
The two countries signed a number of agreements to further economic, commercial and people-to-people ties. These included a memorandum of understanding on liberalisation of civil aviation links between the two counties. They also signed an agreement on mutual administrative assistance and cooperation in customs matters, an MoU on the launch of the India-China financial dialogue and protocols of phytosanitary requirements for trade in farm produce.
April 12' 2005
