The Telegraph
Since 1st March, 1999
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Canada hope for free trade debut

Ottawa, Sept. 2: Even as the Congress and the Left parties stake the future of the UPA government on how close India should get to the US, neighbouring Canada is deftly stepping into the breach.

If all goes well, New Delhi and Ottawa would be ready to sign a Free Trade Agreement (FTA) next year, the first of its kind for India with any country in the western hemisphere.

Such an agreement would be a breakthrough for India in the ongoing efforts to globalise its economy, especially since efforts for an Indo-US Free Trade Agreement have been languishing for over five years.

It is unlikely that the Manmohan Singh government will have the stomach to push the idea of an FTA with the US during the remainder of its term in view of the political risks involved.

Tarun Das, chief mentor of the Confederation of Indian Industry and Thomas d’Aquino, president of the Canadian Council of Chief Executives, who jointly head the recently formed the Canada-India CEO Roundtable, are currently studying a “cost-benefit analysis” of the proposed FTA between New Delhi and Ottawa.

They are expected to submit a report by the end of this year, after which the two sides will look at the modalities of proceeding with the pact.

It is a foregone conclusion here that the CEO roundtable will give the green light to the agreement, although officials are unwilling to go on record since they do not want to bypass the agreed process.

The content and objectives of the FTA with Canada will be of special interest to Bengal in view of the involvement of Haldia Petrochemicals in the process.

Swapan Bhowmick, managing director of Haldia Petrochemicals, attended a recent meeting of the Canada-India CEO Roundtable in Montreal and the expectation here is that he will provide key inputs to the process.

For its part, Canada has been very keen to be involved in Bengal and resurrect the strong ties it once had with India’s eastern region.

The Canada-India FTA was proposed during the visit of Ted Menzies and Deepak Obhrai, parliamentary secretaries to the ministers of international trade and foreign affairs, who led an infrastructure delegation to India earlier this year.

Obhrai is a Canadian MP of Indian origin, elected from the oil-rich Alberta province.

The delegation was to have been led by David Emerson, Canada’s minister for international trade, who could not make the visit due to sudden illness.

Emerson, however, met commerce minister Kamal Nath in Toronto in June when the two sides successfully concluded negotiations on a Bilateral Investment Protection Agreement (BIPA).

It is understood that Nath, who has emerged as a key player in the Doha Round negotiations, told Emerson at that time that if the spluttering World Trade Organisation (WTO) talks go nowhere, India will begin directing its energies towards bilateral arrangements.

In this context, the proposed FTA between India and Canada acquires added significance.

There are no illusions here or in New Delhi that negotiations between the two sides will be tough as they go beyond the niceties of bilateral trade promotion announcements.

But to New Delhi’s advantage, an important element in the process will be the recent arrival here of R.L. Narayan as India’s high commissioner to Canada.

Narayan brings with him the negotiating skills from his recent experience as high commissioner in Kuala Lumpur.

According to commerce secretary G.K. Pillai, India is in the final stages of concluding an FTA with the Association of South East Asian Nations (Asean) and may sign the agreement as early as the next Asean summit in Singapore in November.

Narayan also brings first-hand knowledge of negotiations with Singapore for its already concluded Comprehensive Economic Agreement with India and the ongoing talks for FTAs between India and Malaysia as well as Thailand.

Canada is already taking the bilateral route to supplement its WTO talks and FTAs with Colombia, Peru, the Dominican Republic, South Korea, Singapore and four Central American countries are in various stages of finalisation.

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