| Pant: Being prudent
New Delhi, Nov. 29: The government today said it is committed to lowering import tariff levels to east Asian levels.
However, it will be circumspect about reducing industrial tariffs across the board as part of the trade negotiations under the aegis of the World Trade Organisation, said K. C. Pant, deputy chairman of the Planning Commission.
Addressing the 97th annual general meeting of PHD Chamber of Commerce and Industry, Pant said one specious argument advanced by the developed countries to put pressure on India to lower tariffs is that the developed countries had an average peak tariff of 3.8 per cent after Uruguay Round against roughly 32 per cent in India.
But Pant said the developed countries are glossing over the non-tariff protectionist tendencies in their countries to keep out exports from developing countries like India. The latest, he said, is the proposal by the state of New Jersey in the US to ban business process outsourcing which forms a major chunk of India’s software services exports.
“Such developments are at cross-purposes and the theory of comparative advantages and the principles of the WTO, and we shall do our utmost to safeguard our interests,” Pant said.
He added that under the government’s reform package, encouraging foreign investment in areas of infrastructure and technology holds prime importance.
He said, “We have considerably expanded the list of industries eligible for automatic approval of foreign investment, so that we can achieve our target of raising FDI from $ 4 billion per year to $ 7.5 billion within the Tenth Five Year Plan.”
Public sector reforms also form an important aspect of the reform package since public sector enterprises have put an increasing financial burden on the government.
The failure of the public sector to generate surpluses has led to a reduced ability of the government to support the development of social sectors like health and education, he added.