Press Release jun2006

Shri Kamal Nath, Commerce and Industry Minister, has categorically stated that content of the Doha Round negotiations is more important than artificial deadlines being set in view of the fast track compulsion of some member countries. “We cannot compromise on content for the sake of speed in our hurry to conclude negotiations. Nor can we make disproportionate sacrifices to conclude a deal just because of the internal deadlines of some Members.” he said while participating in Ministerial Meetings of the G-20 and G-33 in agriculture and NAMA 11 (i.e. Non-Agricultural Market Access), immediately on his arrival in Geneva yesterday to attend the four-day Mini-Ministerial Meeting of the World Trade Organization (WTO).

He also cautioned against any attempt at rewriting the Hong Kong Declaration of 2005 and the July Framework of 2004, making it clear that recent talk of a settlement entailing heavy sacrifices by developing countries in terms of Market Access in agriculture and industrial tariffs with only moderate offers for reduction in Domestic Support by developed countries was not acceptable. He said India’s own positions were reflected in the proposals of the G-20 and G-33 in respect of agriculture and in industrial tariffs, of NAMA 11, a group of developing countries that came together in Hong Kong (viz. Argentina, Venezuela, Brazil, Egypt, India, Indonesia, Namibia, Philippines, South Africa and Tunisia).

“The core for us is the protection of the 650 millions of our farmers. Our primary aim is to ensure a fair deal for our farmers, specially when more than 70% of world’s farmers are in the G-20 countries”, Shri Kamal Nath said.

Participating in the NAMA 11 Meeting, Shri Kamal Nath said that the principle of less than full reciprocity as well as the special and differential (S&D) provisions were of paramount importance in the industrial tariff negotiations “in order to fulfill the aspirations of our industry”.

The Mini-Ministerial Meeting is being held to discuss the modalities for negotiations in agriculture and industrial tariffs in the ongoing Doha Round of multilateral trade negotiations.

Shri Kamal Nath, Commerce and Industry Minister, has categorically stated that content of the Doha Round negotiations is more important than artificial deadlines being set in view of the fast track compulsion of some member countries. “We cannot compromise on content for the sake of speed in our hurry to conclude negotiations. Nor can we make disproportionate sacrifices to conclude a deal just because of the internal deadlines of some Members.” he said while participating in Ministerial Meetings of the G-20 and G-33 in agriculture and NAMA 11 (i.e. Non-Agricultural Market Access), immediately on his arrival in Geneva today to attend the four-day Mini-Ministerial Meeting of the World Trade Organization (WTO).

The Mini-Ministerial Meeting is scheduled to discuss the modalities for negotiations in agriculture and industrial tariffs in the ongoing Doha Round of multilateral trade negotiations.

Shri Kamal Nath, Union Minister for Commerce & Industry, has said that the development challenge of the Doha Round must be addressed if the current global trade negotiations are to succeed. In a letter addressed to trade ministers of all member countries of the World Trade Organisation (WTO) on the eve of the Mini-ministerial meeting in Geneva beginning tomorrow, Mr. Kamal Nath has said this Mini-ministerial meeting would provide “an opportunity to address this issue frontally and substantially”.

“There is a growing disquiet that the contours of the development dimension of this Round are not yet apparent. What does development mean? Surely, it cannot mean displacement of subsistence farmers and de-industrialisation of developing economies”, he said while releasing the letter in London today.

Members must recognise the stark reality that the situations of developed and developing countries differed in at least on crucial aspect – “while the sensitivities of developed countries in matters of trade liberalization involve commercial issues, for developing countries such sensitivities involve the survival and well-being of their poorest citizens, the bulk of whom depend on agriculture for their livelihoods. Livelihood security and subsistence of the poor are not negotiable issues”, the Minister has stressed, adding that these two differing sets of concerns were not equal and could not be treated equally.

In agriculture, “it is for this reason that we have been pressing for very substantial reductions in trade distorting subsidies that the developed countries have been providing to their agricultural sectors. It is also for the same reason that we have been insisting that overall tariff reduction commitments by developing countries should at most be two-thirds of those of developed countries. Of critical importance is an adequate number of Special Products and an effective Special Safeguard Mechanism (SSM) instrument that can provide a modicum of protection to farmers in developing countries”, he said.

In the area of industrial tariffs also, Mr. Kamal Nath emphasised that developing countries should not be prevented from developing their infant industrial sectors. “An over-ambitious programme of tariff liberalization can permanently foreclose the possibility of industrial development in many developing countries – in some cases, actually leading to de-industrialisation”, he cautioned.

In services, he pointed out that movement of goods was also linked to movement of people and indicated that “if even non-immigration commitments are sought to be denied on the plea of sensitivities, it will not be possible to arrive at a balanced outcome in these negotiations”.

The issue of non-tariff barriers (NTBs), abuse of anti-dumping provisions etc. must be dealt with effectively and prevention of bio-piracy and preserving traditional knowledge must be ensured by addressing the issue of TRIPS and Convention on Bio-diversity (CBD) relationship, he said.

A balanced outcome across these different areas would require crystallizing the development character of the Doha Round to meet the aspirations of WTO’s diverse membership and members must demonstrate the political will to do this, he emphasised.

KAMAL NATH TO ATTEND WTO MINI MINISTERIAL MEETING IN GENEVA

Shri Kamal Nath, Union Minister of Commerce and Industry, will attend the Mini-Ministerial Meeting of the World Trade Organisation (WTO) in Geneva in which around 40 to 50 trade ministers of WTO member countries are expected to participate. The meeting, scheduled to be held from 29^th June to 2^nd July, 2006, will discuss the modalities for negotiations for agriculture and non-agricultural market access (NAMA) or industrial tariffs. While agriculture and NAMA are not the sole elements of the Doha agenda, these two areas are seen as the most crucial for breaking the current stalemate and moving the Doha Round forward. The meeting assumes special significance as, according to analysts, if the issues are not resolved at the forthcoming mini-ministerial, conclusion of the Doha Round (launched at Doha in Qatar in 2001) could get inordinately delayed. The discussions will be based on the text of the modalities for negotiations in agriculture and NAMA which was released by the WTO earlier this week.

Shri Kamal Nath will be accompanied by a high level official delegation that will include representatives of the Ministries of Commerce and Industry, Agriculture, Textiles and others.

The Minister will also participate in ministerial meetings of the G-20 and G-33 on the sidelines of the mini ministerial on 29 June. G-20 is a coalition of developing countries in the agriculture negotiations, while the G-33 is an alliance of developing countries with defensive interests in agriculture through the instrumentality of Special Products and Special Safeguard Mechanism to protect the interests of their farmers. India is a leading member of both.

A meeting to review progress of negotiations in services will be convened in Geneva on 1^st July by the European Union (EU) Trade Commissioner Mr. Peter Mandelson, in which India along with other member countries will participate.

The Second Annual India-UK Business Leaders' Forum is scheduled to be held in London on June 27, 2006. The Forum is being co-organized by the Commonwealth Business Council (CBC), Confederation of Indian Industry (CII), UK Trade & Investment and Government of India. A high-profile government and business delegation, is being led by Shri Kamal Nath, Minister of Commerce and Industry, and includes Shri Kapil Sibal, Minister of Science & Technology, and Dr. Ajay Dua, Secretary, Department of Industrial Policy & Promotion. An 18-member CEO delegation is led by Mr. R Seshasayee, President, CII. The ‘India Everywhere’ campaign will come alive in UK during this Forum after successful stops at Davos, Hannover and Tokyo.

The theme of the Forum revolves around ‘innovation, investment and infrastructure’- the key priority areas for India’s growth. The forum will provide a strong platform to showcase India as an attractive investment destination especially in the area of infrastructure where UK, being the financial powerhouse of the world, can partner with India.

The CEO delegation at the Forum will include Mr. Sunil Bharti Mittal, Vice President, CII, Co-Chair Indo-British Partnership & Chairman and Group Managing Director, Bharti Enterprises; Dr. Jamshed J Irani, Past President, CII & Director, Tata Sons Ltd; Mr. Rajive Kaul, Past President, CII & Chairman, Nicco Corporation Ltd; Mr. N Kumar, Past President, CII &, Vice Chairman, The Sanmar Group; Mr. Sunil Kant Munjal, Past President, CII & Chairman, Hero Corporate Service Ltd.; Mr. Bobby Bedi, Managing Director, Kaleidoscope Entertainment Pvt. Ltd.; Dr. Anand Burman, Vice Chairman, Dabur Pharma Ltd.; Mr. Prashant Jhawar, Vice Chairman, Usha Martin Ltd; Ms. Naina Lal Kidwai, Country Head & CEO HSBC, Ltd.; Mr. Atul Kirloskar, Chairman and Managing Director, Kirloskar Oil Engines Ltd., Mr. Deepak Premnarayen, Chairman, ICS Infrastructure; Mr. Analjit Singh, Chairman, Max (India) Ltd.; Mr. Phiroz Adi Vandrevala, Executive Vice President, Tata Consultancy Services; and Lt. Gen. (Retd.) Samsher S Mehta, Director General, CII.

With the growing presence of India in the UK, insightful sessions focusing on the partnership between the two countries have been organized including ‘Increasing Investment Flows’, ‘Collaboration – Does the answer lie in joint innovation?’ and 'India UK Partnerships in 2015' among others. A session on ‘Solving India’s infrastructure Conundrum’ will showcase case studies on Indian power sector and airports.

Bilateral trade between India and UK has grown impressively over the years - it stood at USD 11.6 billion in 2004 from USD 4.3 billion in 1993. UK was India’s fourth-largest trading partner (accounting for 3.7 percent of its total trade) in 2004. Around 2000 joint ventures have been signed between the two countries since 1993, reflecting an increasingly strong Indo-British partnership.

Japan has formally lifted the ban on import of Indian mangoes, thereby providing market access to this king of fruits after two decades. The Japanese Ministry of Agriculture, Forestry and Fisheries have formally communicated the decision to the Indian government stating that “Japan has formally lifted the ban on import of Indian mangoes in Japan on June 23, 2006 on the basis of the request by the Indian side, after confirming that there is no risk of infiltration of diseases and pests through previous scientific and technical examinations; and also getting acceptance through procedures like public hearing, public comment etc”.

Shri Kamal Nath, Union Minister of Commerce & Industry, has hailed the decision as marking “a major step forward in securing access to an important market for a major Indian agricultural product”.

The lifting of the ban comes in the wake of Shri Kamal Nath’s visit to Japan last week and his persistently pursuing the matter with the Japanese authorities ever since 2004. Shri Kamal Nath first took up the issue of market access for Indian mangoes with Mr. Nakagawa, Japanese Minister of Agriculture, Forestry and Fisheries, in August 2004, and subsequently again during his visit to Tokyo in 2005, when he invited Japanese quarantine authorities to visit India for on-site tests and inspections. A Japanese technical team visited India earlier this year. The team was satisfied with the results and agreed to move ahead with the process to lift the ban, thus setting the stage for lifting the twenty-year-old ban.

The mango varieties that will now be imported by Japan would be Alphonso, Banganapalli, Kesar, Langra, Chausa and Malika which are grown in pre-identified areas of Andhra Pradesh, Gujarat, Maharashtra, Uttar Pradesh and West Bengal, according to the communication from Japan.

It was in 1986 that Japan imposed a ban on the import of Indian mangoes because of suspected pest infestation by fruit flies and hence, Japanese consumers had to forego the pleasures of this king of fruits – the Indian mango. Scientific evidence was collected through large-scale tests conducted throughout India which revealed that Indian mangoes were indeed free from fruit fly pests. Data of these tests were provided to the Japanese authorities as far back as 1998 and 1999. Japanese authorities then insisted on vapour heat treatment before import into Japan to ensure disinfestations. This too was complied with. Later, an issue was raised about the incidence of a new fruit fly. A survey was commissioned and 3 years’ of data collection confirmed that there was no infestation by any new fruit fly. Despite all these efforts, the ban was not lifted.

Shri Kamal Nath, Union Minister of Commerce & Industry, and the U.S. Trade Representative Susan C. Schwab met in Washington last evening for the third Ministerial-level meeting of the U.S.-India Trade Policy Forum (TPF). Shri Kamal Nath and Ms. Schwab agreed on a number of initiatives to strengthen and deepen the bilateral trading relationship. With India already among the United States’ fastest growing major bilateral trade relationships, the cooperative steps endorsed today will serve to further trade and investment, with the goal of doubling two-way trade in three years. They also discussed the Doha negotiations, agreeing that the U.S. and India share a commitment to conclude a successful, far reaching Doha Round by the end of 2006.

“Under the Trade Policy Forum we continue to make steady progress on key issues to improve the bilateral trade and investment climate,” said Ambassador Schwab. “We remain committed to doubling bilateral trade over the next three years, and improving the regulatory, customs and intellectual property protection climate is key.”

Shri Kamal Nath said, “The Trade Policy Forum has, within a short time emerged as a very effective forum for the two sides to enhance bilateral trade and investment. It was encouraging to see both sides engaged in intensive discussions at the expert level on a variety of issues of mutual interest.”

· Cooperation on an action plan and technical assistance to promote innovation, creativity and technological advancement by providing a vibrant intellectual property rights regime;

· Initiation of a Bilateral Infrastructure Investment Program that will focus on identifying investment opportunities, incentives and challenges in key infrastructural sectors;

· Various steps to address several sanitary and phytosanitary (SPS) issues including Indian mango exports to the United States and U.S. almond, wax covered fruit and wheat exports to India;

· Progress toward selecting participants for a working group on legal services to discuss market access and other relevant issues;

· Continued discussions on tariff structures to facilitate wine and spirits trade as well as discussions on emissions standards for large motorcycles; and

· The creation of a senior-level private sector adjunct to the Trade Policy Forum that will provide strategic direction, input and support to the TPF.

The US-India Trade Policy Forum is an institutional arrangement between the two governments to discuss trade and investment issues. The Trade Policy Forum (TPF) was launched during the visit of Indian Prime Minister Dr. Manmohan Singh to Washington, DC, in July 2005. The inaugural, ministerial session of the Forum was held in November 2005 in New Delhi, the second session was in February 2006 in Washington, DC. Additional meetings at the Deputy level were held in March 2006 in New Delhi and again when Deputy USTR Karan Bhatia led a 25-member US Government delegation to New Delhi on May 30, 2006.

Minister of State for Commerce, Shri Jairam Ramesh, held discussions with various Commodity Boards under the Ministry, here today, with a view to identifying products that are region specific and that could be registered with the Geographical Indications (GI) Registry, Chennai. The Minister had earlier visited the Registry in Chennai on 17^th June, 2006.

Chairman, Coffee Board; Chairman, Agriculture & Processed Food Products export Development Authority (APEDA); Controller General of Patents, Designs, Trademarks & Geographical Indications; and representatives of other Boards participated in the discussions. It was decided that to begin with Coffee Board would register Monsooned Malabar variety that is exclusive to Malabar region from Kozhikode to Mangalore. The Spices Board have identified around 61 varieties, out of which Malabar Pepper and Tellichery Pepper are in the process of getting registered. The Board would also take steps to register Alleppey Green Cardamom and Coorg Cardamom in the next three months.

On the issue of Basmati rice, India and Pakistan are in dialogue for jointly filing the GI application before the US and European agencies. At the same time, domestic GI registration by APEDA will also be considered. Chairman, APEDA highlighted the need for amendments to the APEDA Act, 1985 to empower APEDA to enforce quality standards for basmatic rice particularly. In addition, MOS also was of the view that APEDA should identify mango varieties such as Alphonso that could be taken up for GI registration.

With respect to Tea, Darjeeling & Kangra Tea have already been registered and the GI consultation process is on for Nilgiris & Assam.

Shri Ramesh was also informed during the meeting that around 21 items of handicrafts from around the country have been identified by the Ahmedabad-based National Institute of Design (NID) that would be taken up for GI registration.

Shri Ramesh concluded the meeting by urging the Boards to take care to register only such of those items that have the exclusivity. Selectivity is essential for maintaining exclusivity, he said. The advantage of GI registration is that the products would be certified for their origin; would result in elimination of imitations; and a proper inspection mechanism during the registration process would ensure quality, he added.

Shri Kamal Nath, Union Minister of Commerce & Industry, has said that India has the potential to become USA’s largest trading partner and that to realise this ambitious target “barriers that keep our markets apart in many spheres and restrict our trade in goods as well as services must be removed”. The Minister said this while addressing the US-India Business Council (USIBC) in Washington today on the theme of “Enhanced US-India Trade: The Way Forward”.

Indo-US merchandise trade is today about US $ 25 billion and the services trade is estimated at another $ 20 billion. The rate of growth is remarkable, but bilateral trade could be much more, he said.

Referring to the performance of the Indian economy and investment opportunities in India, Shri Kamal Nath said: “India’s showing of 8% GDP growth for the past three years (an average of 7% over the past decade), is riding on this solid entrepreneurial base, as is our 102 billion dollar exports and 140 billion dollar imports, (and also our 162 billion dollar foreign exchange reserve). It is the manufacturing and industrial sector which offers the best opportunities for American investment – an investment of both dollars as well as of technology”.

Stating that centres of economic gravity would gradually but inevitably move eastwards – from the Atlantic Ocean towards the Indian Ocean, Shri Kamal Nath said that with this the gap between Asia and the West would get reduced. “In such a scenario, what better strategic economic partner could the US opt for other than India? And conversely, I must agree that India too very much values having America as her partner as we navigate the 21^st century – we want to navigate it together”, he said.

SB/NR/MRS

FALL IN IMPORT OF SENSITIVE ITEMS DURING APRIL 2005 -MARCH 2006

The total import of sensitive items for the period April-March 2006 has been Rs.16469 crores as compared to Rs.18832 crores during the corresponding period last year thereby showing a fall of 12.5%. The gross import of all commodities during same period of current year was Rs.620827 crores as compared to Rs.478302 crores during the same period of last year. Thus import of sensitive items constitutes 3.9% and 2.7% of the gross imports during last year and current year respectively.

Imports of edible oil, cotton & silk, milk & milk products and rubber have shown a decline at broad group level during the period. Imports of fruits & vegetables (including nuts), spices, automobiles, tea & coffee, Alcoholic beverages and products of SSI have shown increase during the period under reference.

In the edible oil segment, the imports have decreased from Rs.11066 crores last year to Rs.8710 crores for the corresponding period of this year. A significant feature of edible oil import is that import of crude oil has gone up by 21.7% and that of refined oil have gone down by 77.8%. The downfall in edible oil import is mainly due to huge shortfall in import of RBD Palmolein, which has gone down by 73% and other Refined Palm Oil which has gone down by 81%.

Imports of sensitive items from Argentina, Benin, China P RP, Cote D’ Ivoire, Egypt A RP, Germany, Guinea Bissau, United Arab Emirates, United States of America, Vietnam Soc Rep etc. have gone up while those from Brazil, Japan, Indonesia, Malaysia. Sri Lanka DSR and Tanzania Rep have shown a decrease.

IMPORT OF SENSITIVE ITEMS-PROVISIONAL ESTIMATES
								(Value in Rs Crore)
Sr. No.	Commodity Group	No. of Tariff	Weights w.r.t. total sensitive items		Value of Import (Rs Crore)		Difference (Rs Crore)	Growth
		Lines	Upto March 2005	Upto March 2006	Upto March 2005	Upto March 2006	(Col 7 - Col 6)	Growth
1	2	3	4	5	6	7	8	9
1	Milk & Milk Products	16	0.18%	0.09%	33.10	14.06	-19.04	-57.5%
	*fall is observed in Butter Oil and its Contribution is*				*25.46*	*0.00*	*-25.46*	*-100.0%*
	*( and its %age share to this group)*				*76.9%*	*0.0%*
2	Fruits & Vegetables	43	14.07%	19.05%	2650.46	3137.50	487.03	18.4%
	*Significant growth in Cashew nuts in shell IS*				*1799.28*	*2082.65*	*283.37*	*15.7%*
	*( and its %age share to this group)*				*67.9%*	*66.4%*
3	Poultry	10	0.00%	0.00%	0.03	0.33	0.30
4	Tea & Coffee	31	0.78%	1.06%	146.31	173.98	27.67	18.9%
	*Significant growth in Coffee arabica plantation other grade*				*55.62*	*101.56*	*45.94*	*82.6%*
	*( and their %age share to this group)*				*38.0%*	*58.4%*
5	Spices	34	1.90%	2.56%	357.97	422.02	64.06	17.9%
	*(Significant growth in Black Pepper Ungarbled, other cloves and its contribution is)*				*36.97*	*89.87*	*52.90*	*143.1%*
	*( and their %age share to this group)*				*10.3%*	*21.3%*
	*( Significant shortfall in Pepper long and their contribution is)*				*54.39*	*16.96*	*-37.44*	*-68.8%*
	*( and their %age share to this group)*				*15.2%*	*4.0%*
6	Food Grains	11	0.01%	0.02%	2.26	2.76	0.49	Less weigtage
7	Edible Oils	22	58.76%	52.89%	11066.22	8710.41	-2355.81	-21.3%
	*(a) Crude*				*6287.36*	*7651.73*	*1364.38*	*21.7%*
	*( Raio of crude to total Edible )*				*56.8%*	*87.8%*
	*(b) Refined*				*4778.86*	*1058.67*	*-3720.19*	*-77.8%*
	*( Ratio of Refined to total edible import)*				*43.2%*	*12.2%*
8	Alcholic Beverages	11	0.54%	0.73%	101.66	120.66	19.00	18.7%
9	Rubber	11	2.28%	1.67%	429.16	274.51	-154.65	-36.0%
	*Significant shortfall in other natural rubber non-latex*				*164.20*	*37.93*	*-126.27*	*-76.9%*
	*( and their %age share to this group)*				*38.3%*	*13.8%*
10	Cotton & Silk	20	10.38%	9.70%	1954.65	1597.15	-357.49	-18.3%
	*Siginificant Shortfall in :cotton(other than Indian of all staple length)*				*1116.42*	*666.19*	*-450.24*	*-40.3%*
	*( and their %age share to this group)*				*57.1%*	*41.7%*
11	Marble & Granite	9	0.82%	1.11%	155.03	183.55	28.52	18.4%
	*Marble blocks/tiles,polished and others (Simply cut/Sawnmarble trauertine & alabaster with a flat or even surface*				138.17	151.81	*13.64*	*9.9%*
	*( and their %age share to this group)*				*89.1%*	*82.7%*
12	Automobiles	33	2.43%	3.38%	457.42	556.11	98.69	21.6%
13	Product of SSI	37	2.13%	3.50%	401.76	576.89	175.13	43.6%
	*(Umbrella, locks, toys, writing instruments, tiles, glassware, etc.)*
	*Significant growth in ceramic tiles, other glassware used for table excuding glasses, other toys*				*197.88*	*296.02*	*98.14*	*49.6%*
	*( and their %age share to this group)*				*49.3%*	*51.3%*
14	Others (Wheat floor, sugar, cigarette & salt)	12	5.71%	4.24%	1075.47	698.87	-376.60	-35.0%
	Total of Sensitive items		100.0%	100.0%	18831.50	16468.81	-2362.70	-12.5%
	%age share of Import of sensitive items to Total Import (All Commodities)				3.9%	2.7%
	Total of All commodities ( including sensitive items) as per quick estimate				478301.8	620826.7	142524.9	29.8%

Directorate General of Foreign Trade (DGFT) , Ministry of Commerce & Industry
New Delhi, 22nd June, 2006

SB/NR/MRS

The government today announced 50% assistance in airfreight for perishable commodities from any airport in the North East to Delhi or Mumbai airports for exports. Revised guidelines of the Inland Transport Assistance Scheme to this effect under the Export Development Fund for the North East were approved by Shri Jairam Ramesh, Minister of State for Commerce, here today. This is being done in view of the fact that perishable commodities including flowers and horticulture products require special treatment as the earlier guidelines were not being availed by exporters of the region, and frequent requests were being made for revising the guidelines.

(i) 90% of the air freight charged by the airline from any airport in the North Eastern States (NES) or Bagdogra to Guwahati or Kolkata for exports and in case of highly perishable commodities, 50% of the air freight charged by the airline from any airport in the North Eastern States to Delhi or Mumbai Airport for exports.

(ii) Rs.1 per kg. if the goods are transported from anywhere in the NES by road for exports through any notified Land Customs Station in the North Eastern States or through Guwahati airport or actual freight paid, whichever is less.

(iii) Rs.2 per kg. if the goods are transported from North Eastern States to Kolkata or any other port by rail through ICD, Guwahati for exports or actual freight paid, whichever is less.

(iv) Rs.2 per kg. for the goods transported from North Eastern States by rail through ICD, Guwahati to any place in West Bengal for processing and export or actual freight paid, whichever is less.

The State-wise list for the commodities would be done away with and the identified products i.e., banana, guava, lemon, orange, pears, pineapples, plums, cut flowers, ginger, passion fruit, kiwi, apple, bamboo and cane for food purposes from any North Eastern States would be eligible for inland transport assistance.

The list of highly perishable commodities for the purposes of clause (i) above would be identified by Agriculture & Processed Food Products Export Development Authority (APEDA) in consultation with the Commissioner (Horticulture), Government of India.

Dr. Ashwani Kumar, Minister of State (Industry) urged the Punjabi Community in USA to become conduits for American Investments in India and to contribute in the development of social infrastructure in Punjab. He was speaking while inaugurating the 1^st Convention of the New York Chapter of World Punjabi Organization. Around 500 delegates from different countries attended the Convention. He made an impassioned plea before the delegates to use their Influence to strengthen the bonds between India and US. Dr. Kumar also congratulated Shri Vikramjit Singh Sawhney, International President and Shri Inder Singh Bindra President of the New York Chapter for the initiative in bringing together on one platform Punjabis all over the world.

He commended the organization for making the Punjabi culture and Punjabiat known across the globe and lauded the contribution made by the Punjabi Community in shaping future of India right from its freedom struggle. He said that those opting for Public office should be ready to make sacrifices.

Dr. Kumar also used the occasion to recommend Indian Americans that the Indo-US Civil Nuclear agreement provided a historic opportunity for both countries to cement their strategic relationship and said that the failure to have the deal approved in the US could cause an avoidable set back to a strengthened Indo – US relationship.

The Convention was attended by a galaxy of dignitaries across the globe including Mr. Upendra J. Chivukula, New Jersey Legislature, Mr. S.S Dhindsa, Member Parliament and former Union Minister, Mr. Raj Babbar, Member Parliament, Mr. Tarlochan Singh former Chairman, Minorities Commission.

India’s merchandise exports during May 2006 are valued at US $ 9358.06 million (provisional) which is 29.59% higher than the level of US $ 7221.36 million (provisional) during May 2005.

In rupee terms, the exports were Rs.42492.42 crore (provisional) which is 35.31% higher than the level of Rs.31404.91 crore (provisional) during May 2005.

Exports during April-May 2006 are valued at US $ 17704.85 million (provisional), which is 28.40% higher than the level of US $ 13789.35 million (provisional) during April-May 2005. Remarking on the performance, Shri Kamal Nath, Union Minister of Commerce & Industry, said that “the continued double-digit 20% plus growth in India’s merchandise exports for the third year in succession reflects, among other things, the growing global competitiveness of the Indian manufacturing sector and the conducive framework of the Foreign Trade Policy”.

In rupee terms, the exports were Rs.80010.50 crore (provisional) during April-May 2006, which is 33.05% higher than the level of Rs.60134.09 crore (provisional) during April-May 2005.

India’s imports during May 2006 are valued at US $ 13193.35 million (provisional) representing an increase of 21.67% over the level of imports valued at US $ 10843.18 (provisional) million in May 2005.

In rupee terms, the imports were Rs.59907.42 crore (provisional) which is 27.04% higher than the level of Rs.47,155.81 crore (provisional) during May 2005.

Total imports during April-May 2006 are valued at US $ 25788.75 million (provisional) which is 22.79% higher than the level of US $ 21002.82 million (provisional) during April-May 2005.

In rupee terms, the imports were Rs.116522.65 crore (provisional) which is 27.21% higher than the level of Rs.91595.27 crore (provisional) during April-May 2005.

Oil imports during May 2006 are valued at US $ 4151.31 million (provisional) which is 27.34% higher than oil imports valued at US $ 3260.14 million (provisional) in the corresponding period last year.

Oil imports during April-May 2006 are valued at US $ 8344.95 million (provisional) which is 31.44% higher than oil imports valued at US $ 6348.99 million (provisional) in the corresponding period last year.

Non-oil imports during May 2006 are estimated at US $ 9042.04 million (provisional), which is 19.24% higher than the level of such imports valued at US $ 7583.04 million in May 2005.

Non-oil imports during April-May 2006 are estimated at US $ 17443.80 million which is 19.04% higher than the level of such imports valued at US $ 14653.83 million in April-May 2005.

The trade deficit for April-May 2006 estimated at US $ 8083.90 million (provisional) which is higher than the deficit of US $ 7213.47 million (provisional) during April-May 2005.

The manufacturing sector in India is poised to contribute 25% of Indian GDP with a manufacturing growth of 12% to be achieved in 5 to 6 years by 2012, Dr. Ashwani Kumar, Minister of Industry, told audiences in the US while addressing a conference on “Competitiveness in India’s growing Manufacturing Sector” hosted by the Asia Society in New York on Saturday. Hence he urged US investors to invest in the manufacturing sector in India which was witnessing a resurgence and was at the core of the transformation of the Indian economy.

“The Indian manufacturing sector has acquired global competitiveness through the assimilation of global best practices in manufacturing and India’s leadership in the IT sector will be used to give a competitive edge to its manufacturing processes. More than 100 of the Fortune 500 companies have set up R&D centres in India”, he said, adding that “job creation in the hinterland of India is the foremost priority of UPA government, which can only be done by boosting manufacturing which currently accounts for 45 million jobs and 53% of the India’s total exports.”

Chairing a session on Indian Economy at the conference organized by CII-Aspen Institute in Washington, as part of US-India Strategic Dialogue, Dr. Kumar stated that the UPA Government was committed to an economic policy initiative that would ensure growth with jobs to the rural and urban poor. “India is now a serious actor on the global scene and that its demographic profile gives it an unbeatable advantage as compared to China. India has been able to achieve its current economic status on account of the proven competitiveness in the skill intensive sectors of our economy,” Dr. Kumar said. Citing statistics he stated that in 1991 India had 56000 knowledge workers, which have increased to 1.3 million in 2005 and are likely to increase to 2 million in 2008. India’s commitment of 6% of its GDP to Education and 3.5% to Health Care demonstrates a clear policy of the government to invest in its social sectors thereby ensuring the resilience of India’s economy on a long term basis. He said that the Prime Minister’s stated priority of economic engagement with India’s neighbours on the East and West would ensure an effective regional and global integration of Indian Economy in the global economic order.

An inclusivist agenda and India’s soft power in the form of its commitment to the Rule of Law, Democracy and Secularism defined the distinction of India amongst the emerging economy of the world, he added.

The High Powered strategic dialogue was attended by a galaxy of leaders on the American side including Mr. Joseph Nye, former Deputy Secretary of State, Strobe Talbot, President of the Brookings Institution, Sandy Berger former National Security Advisor, Carla Robbins, Deputy editor New York Times, Sylvia Mathews, President Bill and Melinda Gates Foundation and General Brent Scow croft.

The Union Minister of State for Commerce, Shri Jairam Ramesh will be visiting Petrapole on 19^th June, 2006 accompanied by a high level delegation of officials. Petrapole is the border point on the Indian side in West Bengal and is the main trade route by road between India and Bangladesh. 100 per cent Bangladesh exports to India and about 80 per cent Indian exports to Bangladesh goes through Petrapole.

Shri Jairam Ramesh will have a site visit and meet the officials concerned. Members of the high level delegation include Smt. Veena Sikri, High Commissioner of India in Dhaka, Shri R.S. Sirohi, Addl. Secretary (Border Management), M/o Home Affairs, Shri M.V.P.C. Sastry, Joint Secretary, Department of Commerce and other senior officials from M/o Finance, Railways, Central Warehousing Corporation, Border Security Force and Government of West Bengal.

Dr. Ashwani Kumar, Minister of State (Industry), today called upon representatives of American Corporations and also Indian American Companies at a meeting at India Engineering Centre in Chicago to look to India as a manufacturing hub and to enter into engaging commercial partnerships with Indian companies to take advantage of the competitive advantage that India offers.

He said that India had achieved a growth rate of 8.4% and was likely to achieve double digit growth rates on a sustained basis with less than 10% of FDI received by China and with a lower savings rate than China. The Minister further stated that India was determined to increase the share of manufacturing from 17% of its GDP to over 30% by 2020. “A 1% growth in manufacturing would lead to a 3% growth in jobs and would thereby unfold huge employment generation opportunities in the hinterland of India”, he said.

Citing various studies by Goldman Sach, AT Kearney, World Economic Forum and UNCTAD, Dr. Kumar said that India was one of the most preferred investment destinations of the world and in fact, the most recent McKinsey Report has held that India has potential to achieve the same level of productivity in manufacturing sector as that of European countries with cost as low as 20% compared to them, he added.

The meeting was attended by leading Indian American and American business leaders wishing to do business in India. Medium sized Companies represented at the meeting included Plante Moran Co., Lee Salberg International Group, LGO Global and Barnes, Richardson and Colburn. A group of American Securities and Brokerage Companies presented alternative and innovative methods for raising foreign capital for investment in India.

He also told the gathering that Indo-US relations had undergone a significant change from one of contention to that of conciliation and a mutually reinforcing engagement. “Indo-US civil nuclear agreement of July 2005 was a clinching evidence of the growing relationship”, he said.

Dr. Ashwani Kumar also met leading Indian Americans in Chicago and expressed appreciation for their role in enlisting support for the Indo-American Civil Nuclear Agreement of July 2005 between President Bush and Prime Minister Dr. Manmohan Singh. Prominent Indian Americans who had extensive discussions with Dr. Kumar included Dr. Bharat H. Brar, Chairman Medical Licensing Board, State of Indiana; Mr. Rajinder Bedi and Mr. Sam Ramesh, Managing Director of the Office of Trade and Investment, State of Illinois and Mr. Raghu Nayak. He also spoke to Congressman Jesse Jackson Jr. and thanked him for his support for the Indo-US civil nuclear deal. Dr. Kumar was informed of the growing support for the deal amongst US law makers across the political spectrum.

Dr. Kumar is scheduled to participate in the CII-Aspen Strategy Group in Washington DC on 17^th and 18^th July when he will engage with Dr. Henry Kissinger, Joseph Nye, Snow Brencrozt and others.

SB/NR/MRS

Japan has agreed to lift its two-decade old ban on import of Indian mangoes, Mr. Shoichi Nakagawa, Minister of Agriculture, Forestry and Fisheries of Japan, announced in the presence of Shri Kamal Nath, Union Minister of Commerce and Industry, in Tokyo at the India-Japan Business Summit last evening. Shri Kamal Nath, who had pursued the matter with the Japanese authorities persistently so as to secure market access for Indian mangoes in Japan, announced that once the embargo was lifted, the Agricultural and Processed Food Products Export Development Authority (APEDA), the concerned export promotion agency, would hold a special mango festival in Japan in July, 2006. The ban on import of Indian mangoes is expected to be formally lifted by July, 2006.

The mangoes ( Alphonso, Banganpalli, Kesar, Langra, Chausa and Malika) to be imported by Japan are from pre-identified areas of production – namely, Andhra Pradesh, Gujarat, Maharashtra, Uttar Pradesh and West Bengal, benefiting farmers in all these regions.

Shri Kamal Nath first took up the issue of market access for Indian mangoes with Mr. Nakagawa in August 2004, and subsequently again during his visit to Tokyo in 2005, when he invited Japanese quarantine authorities to visit India for on-site tests and inspections. A Japanese technical team visited India earlier this year. The team was satisfied with the results and agreed to move ahead with the process to lift the ban, thus setting the stage for lifting the twenty year old ban.

Shri Kamal Nath, Union Minister of Commerce & Industry, has said that the ASEAN plus Chindia (China and India) will become a global powerhouse to be reckoned with united in a mutually beneficial relationship. Participating in Roundtable Discussion at the East Asia Summit of the World Economic Forum in Tokyo today on “ASEAN’s Strategic Challenge: How will it compete with Chindia”, he underlined that “ASEAN does not face a threat or a strategic challenge vis-à-vis India and China. The issue at hand is not ASEAN versus Chindia but ASEAN plus Chindia. Given the strengths of ASEAN and the growing muscle of India and China, the scope for constructive cooperation is immense and we believe this is the direction the region should take”. This, he said, would be logical in view of their natural complementarities, since ASEAN had an abundance of natural resources as also significant technological skills, which provided a natural base for the growth of synergies and integration between ASEAN, China and India in both trade and investment.

“We strongly believe the future of Asia lies in ASEAN plus Chindia. Competing for the world’s investment resources individually will certainly bring gains to each country. Competing for them as a regional powerhouse will widen and deepen the advantages of globalisation that will truly make the region what management gurus call ‘The Next Big Thing’,” he said.

Pointing out that a pragmatic search for reciprocal self-interest had, in fact, been the fulcrum of India’s “Look East” policy, he said: “We have already concluded a comprehensive Economic Co-operation Agreement (CECA) with Singapore and are close to finalising a similar Agreement with ASEAN and Thailand. Such agreements aim to leverage the rich reservoir of talent and resources of the region to pull our economies out of poverty and build a new Asia”.

Earlier, speaking at the Plenary Session of East Asia Summit on “Asia’s Growth Model: Can it Continue to Sustain Itself?”, Shri Kamal Nath answered the question whether the growth momentum in India would continue, and said: “I believe we can. I am convinced that the demographic trends that are emerging will lead to changes in economic policies, and hasten the pace of economic reforms. Over half of the population is less than twenty-five years of age. As this cohort enters the workforce, they will bring a new mindset less attached to older, interventionist policies. They will want India to change and change quickly”.

The Japan Bank for International Cooperation (JBIC) has agreed to fund the Pench Diversion Scheme for Irrigation in Chhindwara (Madhya Pradesh). Shri Kamal Nath, Minister of Commerce & Industry, who is currently on an official visit to Japan, raised the matter with the Chairman of JBIC in Tokyo yesterday in the presence of his counterpart Minister of Japan for funding of this important project.

Chhindwara, a predominantly tribal region, is also Shri Kamal Nath’s constituency, which he has been representing in the Lok Sabha since 1980.

The Pench Diversion Scheme, costing Rs.564 crore, will irrigate almost 1 lakh hectares in Chhindwara & Seoni Districts of Madhya Pradesh.

Shri Kamal Nath had been pursuing the matter for the last two years with the Water Resources Ministry, the Planning Commission and the Department of Economic Affairs for funding through the JBIC, and final approval was obtained in April 2006.

Following the discussions with Shri Kamal Nath, the JBIC will be sending a high level team to India. The team is expected to meet officials of the Department of Economic Affairs and Water Resources Ministry on 19^th June and finalise details of the funding. JBIC is also sending their technical team to Chhindwara and Bhopal to evaluate the project report.

Shri Kamal Nath said that he hoped the project would be completed within 3 years.

Participating in a Round Table on “The New Big 4: BRIC” (Brazil, Russia, India, China) in St. Petersburg (Russia) last evening, Shri Kamal Nath, Minister of Commerce & Industry, urged Ministers of BRIC countries to work for unified action to promote sustainable development in all spheres and to fully exploit the inherent potential for doubling their share in world growth to 40% in 2025 from the present 20%. Ministers of Brazil, Russia, India and China took part in the Round Table, which was moderated by Mr. Peter Sutherland, Chairman of Golden Sachs International.

Referring to the problems indicated by Goldman Sachs viz., bourgeoning population of the BRIC countries, inefficiency in energy use and under representation of these economies in the global capital market, he said “these factors should not come in the way of our growth and should be well taken care of for achieving the goals for becoming the most dominant economies by 2050 or earlier”.

Shri Kamal Nath, who had earlier called on the President of the Russian Federation Mr. Vladimir Putin, reiterated that India’s relations with Russia were time-tested and the changing global dynamics had given a new dimension to it. He underlined the plan to achieve US $ 10 billion bilateral trade with Russia by 2010, a 5-fold increase from the present US $ 2 billion. The proposed Indo-Russian Forum on Trade and Industry as agreed during the visit of the Russian Economy & Trade Minister Mr. German Gref to India in February 2006 would identify the potential areas of trade and investment, he added.

SB/NR/MRS

Citing the Investment Commission of India’s recent estimates, Shri Kamal Nath, Minister of Commerce & Industry, said today that investment opportunity of US $ 500 billion would emerge in India in the next 5 years in major economic sectors, of which US $ 250 billion investment opportunities exist in the infrastructure sector alone and urged Japan to relook at its investment strategy in India, as “Japan’s capital and technology combined with India’s human resources and business prospects are the best possible combination”. The Minister, who is currently leading a high level delegation to Japan, was speaking at the closing session of the India-Japan Business Summit in Tokyo, co-sponsored by the Ministry of Economy, Trade & Industry (METI) of Japan and India’s Ministry of Commerce & Industry (Department of Industrial Policy & Promotion).

Stating that India is offering opportunities as never before, Shri Kamal Nath in particular flagged the opportunities in India’s manufacturing sector like “auto-components & automobiles, drugs & pharmaceuticals, R&D & Biotechnology, chemicals & petrochemicals, agro & food processing and fashion & textiles, which were registering double-digit growths. The skilled manpower and the knowledge base have contributed to the manufacturing competitiveness of the country. The Investment Commission of India estimates investment opportunities of US $ 130 billion in manufacturing sector in next five years alone. We expect foreign investors to be the major players in this segment”, he said.

He invited Japanese enterprises to invest in India’s Special Economic Zones (SEZs), saying that “though, today there are only 15 SEZ functioning, we expect the number to increase to 150 in the next 1-2 years in view of the unprecedented policy incentives provided in the scheme. SEZs are well spread geographically in India and also have diverse characteristics to suit requirements of investors. I see SEZs as the future centres of economic growth in India. I am sure that the Japanese corporates will have a closer look at India as their next business destination and we hope to carry forward the consolidation of our economic relations”.

Shri Kamal Nath, Minister for Commerce and Industry, while participating in the Plenary Session: “Challenges of Globalisation Competitive Advantages of Developing Countries” at the 10^th International Economic Forum at St. Petersburg, today called for closer economic ties between the BRIC countries (Brazil, Russia, India & China). He said “BRIC countries are the natural leaders of the developing world”. He urged that BRIC countries should identify their trade barriers and take steps to overcome them. He asked for profitable cooperation in the services sector especially health care, financial services, IT and ITES. Shri Kamal Nath expressed the hope that BRIC countries would be the four most dominant economies by 2050 as predicted by Goldman Sachs Investment Bank.

Speaking about the strength of the Indian economy, the Minister noted that a growing number of multinationals from both the West and the East are investing in a big way in R&D and manufacturing facilities. In fact, some of them like Hyundai of South Korea and Suzuki of Japan have made India the hub of their exports of vehicles to the advanced countries. He also highlighted the excellent progress in the area of information technology especially in software exports and providing ITES to corporates in US and UK. “Our huge scientific and technical work force, our institutes of technology, like IITs, have resulted in India becoming a leading technology and service resource provider for the world” he said.

Shri Kamal Nath called for developing the vision and the skills for managing globalisation. He noted that developing countries more than ever before have to ensure that trade and rules of the multilateral trading system are fair and transparent; that they take into account our growing population, our indices of poverty and peculiar socio-economic requirement. He said “we must see that our trade is conducted to raise the standard of living of our people, to ensure full employment and to achieve steady growth in the volume of real income.” In this context, he noted that the agricultural sector which provides livelihood to hundreds of millions of farmers becomes critical for the poor developing countries. The Minister said “it becomes central to our collective interests that the trade distorting subsidies and protection provided by developed countries are eliminated so that a level playing field is established.”

Interacting with Indian journalists in Washington, the Minister of State for Industry, Dr. Ashwani Kumar has said that the Indo-US relationship has entered a new phase. “This is a historic moment to cement further Indo-US engagement across a very wide variety of common goals and concerns. To this end, I will be engaging with a large number of people”, he said.

Expressing confidence that the initial legislation pertaining to the Indo-US civilian nuclear deal will be “flagged” in the Congress “in the near future”, Dr. Kumar has said the pact was essential for the growth of strategic partnership between the two countries.

“I am confident that the initial legislation will be flagged in the near future. The general sense that I had got during this visit is that there is wide support in principle for the nuclear deal despite certain issues that need to be addressed”, Dr. Kumar said.

Calling the latest report of the New York based Council on Foreign Relations as a decisive endorsement of the utility of the (nuclear) deal to both sides, Dr. Kumar said that India has put all the cards on the table and would want the deal as outlined in the July joint statement. “Nothing that is inconsistent with the July statement or going beyond the July statement can be accepted by India. The Indian position has been made clear on more than one occasion and the US is fully conscious of the sensitivities in India. “It is clearly understood that the Indian government will stick to the position that has been endorsed by the Indian Parliament”, Dr. Kumar said.

SB/NR/MRS

Dr. Ashwani Kumar, Minister of State for Industry, who is currently Greenbrier, Virginia (USA) to participate in a meeting with leading CEOs of American Petrochemical companies has invited mega investment by American companies in India’s petrochemical sector. He told a gathering of over 50 CEOs of major corporations including a select group of NRIs that the Indian Petrochemical market offers immense potential for high returns on investment across a large spectrum of commercial activity. He informed the gathering attended amongst others by senior executives of Dow Chemicals, Dow Corning, Exon Mobil, Total SA, British Petroleum an, Akzo that the Indian petrochemical sector with a turnover of nearly USD 40 billion was growing @ 9% and was poised for an exponential growth. “India’s per capita polymer consumption was only 4 kilograms as against China’s 26 kg and the world average of 25 kg per capita and, therefore, the Indian petrochemical market offers huge possibilities”, he said.

Dr. Kumar is leading a high powered delegation from India, which include Mrs. Satwant Reddy, Secretary, Petrochemicals, Dr. Ajay Dua, Secretary Department of Industrial Promotion, Mr. Javed Usmani, Joint Secretary PMO and Mr. K.C. Misra, Joint Secretary Department of Petrochemicals, besides Chief Secretaries of the states of West Bengal and Karnataka. This conference is a sequel to the initiative Prime Minister Dr. Manmohan Singh had taken in September 2004 to attract mega investments in India.

Underlining the Indian government’s commitment to being an enabler and facilitator in setting up Petroleum Petrochemical Investment Regions (PCPIRs) spread over 100-250 km areas through public promote partnership initiatives, he said that based on the preliminary study and evaluation, the states of Karnataka, West Bengal, Orissa, Gujrat and Andhra Pradesh had been identified as possible destinations for setting up PCPIRs.

In a separate meeting presided over by Governor of Michigan John Engler who is also President of the National Association of manufacturers which has a membership of over 30, 000 American manufacturing companies, Dr. Ashwani Kumar called upon major American Corporations to look to India as a manufacturing hub and to enter into commercial partnerships with Indian manufacturing companies to optimise the competitive advantage that India offers. Citing various studies by AT Kearney and UNCTAD, Dr. Kumar said that India was one of the most preferred investment destinations of the world considering the competitive labour costs and advanced scientific, technical and managerial skills.

The meeting was attended by top management of over 100 American Corporations including Bechtel, GE, Cummins, Whirlpool, Meadwestvaco, General Motors, Halliburton, EDS, Eastman Chemical Company etc. Mr. Victor Menezes former Chairman of Citibank, Mr. Romesh Wadhwani, Parag Saxena and Anand Dorairaj of the NRI Task Force were amongst those who attended.

DR. ASHWANI KUMAR URGES GLOBAL AND US CORPORATIONS FOR MEGA INVESTMENTS IN INDIA’S
PETROCHEMICALS AND MANUFACTURING SECTOR

Dr. Ashwani Kumar, Minister of State for Industry, while addressing a Conference of over 50 CEOs of leading global chemical and petrochemical majors yesterday at Greenbrier, Virginia made a forceful plea for FDI in India’s petrochemical and chemical sector. Senior executives of companies such as Dow Chemicals, Dow Corning, Exxon Mobil, Total SA, British Petroleum and Akzo participated in the conference. The Minister informed that the Indian petrochemical sector with a turnover of nearly USD 40 billion was growing @ 9% and is poised for an exponential growth. Dr. Kumar informed the gathering that India’s per capita polymer consumption was only 4 kilograms as against China’s 26 kg and the world average of 25 kg per capita and therefore the Indian petrochemical market offers huge possibilities.

Dr. Kumar said that the Government of India is committed to being an enabler and facilitator in setting up Petroleum Petrochemical Investment Regions (PCPIRs) spread over 100-250 km areas through public promote partnership initiatives. He said that based on the preliminary study and evaluation, the states of Karnataka, West Bengal, Orissa, Gujrat and Andhra Pradesh have been identified as possible destinations for setting up PCPIRs. These states have been chosen because the basic infrastructure is existing and can be expanded further. Dr. Kumar said that “ anchor tenants” such as ONGC were already in Mangalore. The Haldea Complex in West Bengal could facilitate an early start up of PCPIR in West Bengal and could attract multi-billion dollar investments for creating a world- class petrochemicals infrastructure in the country. Dr. Ajay Dua, Secretary, Department of Industrial Policy & Promotion, also attended the Conference along with other senior officials. This conference is a sequel to the initiative of Prime Minister taken in September 2004 to attract mega investments in India.

Later on the same day, Dr. Kumar, attended a meeting of the National Association of Manufacturers (NAM) at Washington. NAM is an association of over 30,000 US manufacturing companies. He urged the gathering to look upon India as a manufacturing hub and enter into engaging commercial partnership with Indian manufacturing companies.

The Minister further stated that India is determined to increase the share of manufacturing from 17% of its GDP to over 30% by 2020. He said that a 1% growth in manufacturing would lead to a 3% growth and would thereby unfold huge employment generation opportunities in the hinterland of India.

The NAM meeting was presided over by Governor of Michigan John Engler who is President of the National Association of manufacturers and was attended by top management of over 100 American Corporations including Bechtel, GE, Cummins, Whirlpool, Meadwestvaco, General Motors, Halliburton, EDS, Eastman Chemical Company etc. Mr. Victor Menezes former Chairman of Citibank, Mr. Romesh Wadhwani, Parag Saxena and Anand Dorairaj of the NRI Task Force were amongst those who attended.

At both Green Brier and NAM meeting, Dr. Kumar made an impassioned plea of support for the Indo-US Civil Nuclear Deal, which he said would alter the paradigm of Indo-US relations, one from contention to a purposive engagement in pursuit of common goals. He said that the time had come to put aside the past and to move forward towards strengthening the strategic partnership between India and the US, which was in the common interest of both countries.

SB/NR/MRS

Shri Kamal Nath, Union Minister of Commerce and Industry, will be leading a high-level delegation to Tokyo (Japan) from 14^th – 16^th June 2006 to participate in the East Asia Summit of the World Economic Forum (WEF) and an India-Japan Business Summit. Dr. Ajay Dua, Secretary, Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, and other senior officials will accompany Mr. Nath. Shri. Babu Lal Gaur, Industries Minister (and Former Chief Minister of Madhya Pradesh) will also participate in the Summit.

Bilateral trade between India and Japan is on the rise. This is evident by the increase in the number of joint declarations, delegation visits and other business events between the two countries. Japan is among India’s top five trading partners. Total trade between India and Japan was close to US$ 5 billion during 2004-2005. Japan has emerged as the fourth-largest FDI contributor to India for the period from 1991 to 2004. Consistently, Japanese companies such as Suzuki, Toyota, Honda and Mitsubishi Chemicals have invested in India, reiterating their faith in the ‘fastest growing free market democracy’. Japan contributes around 8 percent to India’s total technical collaboration with foreign partners, another proof point of the growing partnership.

Indian companies too, are exploring Japan as an investment opportunity. Around 70 Indian IT companies have already established their offices in Japan. Emphasizing the growing importance of the Indo-Japanese bilateral relations, Mr. Kamal Nath said, “While the presence of skilled manpower and the large and growing domestic Indian market are the major strengths attracting Japanese investors to India, Indian investors are also exploring the Japanese market for the innovative technologies that it offers”.

The Indian delegation will give a fresh thrust to the ‘India Everywhere’ campaign at the World Economic Forum’s East Asia Summit being held in Tokyo from June 14^th–16^th. Over 250 global leaders from business, government and academia will congregate at the forum to shape Asia's political, industry and economic agendas. The theme of this year’s meeting is ‘Creating a New Agenda for Asian Integration’. A key discussion item is integrating India further into East Asia.

On the eve of the WEF event, the Ministry of Economy, Trade & Industry (METI) of Japan and India’s Ministry of Commerce & Industry are co-sponsoring an India-Japan Business Summit. This summit is being organized by the Japan External Trade Organisation (JETRO), the Confederation of Indian Industry (CII) and the India Brand Equity Foundation (IBEF), and is being supported by Keizai Doyukai and Keidanren. The India-Japan Business Summit will focus on the key opportunities in India in manufacturing, infrastructure, biotechnology, and research and development.

A CEOs delegation comprising leading industrialists and entrepreneurs will be led by Mr. R Seshasayee, President, CII. These include Mr. Vikram Kirloskar, Vice Chairman, Toyota Kirloskar Motor Pvt Ltd, Mr. Adil Zainulbhai, Managing Director, McKinsey India; Mr. Hari Bhartia, Co-Chairman & Managing Director, Jubilant Organosys; Mr. Brian Tempest, Chief Mentor and Executive Vice-Chairman of the Board, Ranbaxy Laboratories; Mr. Ajit Gulabchand, Chairman and Managing Director, Hindustan Construction Company Ltd; Mr. Nand Khemka, Chairman, Sun Group; Mr. Shiv Khemka, Executive Director, Sun Group; Mr. Hemendra M Kothari, Chairman, DSP Merrill Lynch; Mr. Piyush Pandey, Executive Chairman & National Creative Director, Ogilvy & Mather; Mr. Mukesh Butani, Senior Partner & Head of Tax Business Unit, BMR & Associates; Gen. S.S Mehta, Director General, Confederation of Indian Industry; Mr. Ajay Khanna, Chief Executive Officer, India Brand Equity Foundation & Deputy Director General, Confederation of Indian Industry; and Mr. Gurpal Singh, Deputy Director General, Confederation of Indian Industry.

Shri Jairam Ramesh, Minister of State for Commerce has called for expanding the existing areas of trade & investment between India and Ethiopia and also to find new areas of cooperation between the two nations. The Minister who was speaking at the Inauguration of the 4^th India-Ethiopia Joint Trade Committee meeting (JTC) here yesterday proposed that different Indian Delegations would visit Ethiopia in the next 60 days to look for possibilities. These would include delegations of National Institute of Information Technology (NIIT)-for IT training in Ethiopian educational institutes; Infrastructure Leasing & Financial Services (IL&FS)-to explore possibilities in Infrastructure project in Ethiopia by Indian Companies; BHEL – to explore long term partnership in Energy; Council of Leather Exports- to explore possibility of sourcing raw hides and skins from Ethiopia and a delegation of Tea Board for cooperation and development of Ethiopian Tea Sector.

Meanwhile, Mr. Ahmed Tusa, State Minister of Trade and Industry of Ethiopia, who led the Ethiopian delegation, referred to the widening Trade Gap between the two nations and requested the Indian side for S&D Tariff Treatment, Technical and Capacity Building support and Financial Assistance. He stated that encouraging Indian investors to invest in Ethiopia would be the prime vehicle to narrow the Trade Gap.

Both sides agreed to cooperate in the areas of Infrastructure, Agriculture trade, textiles, IT, Pharmaceuticals, Power & Energy etc. Both countries also agreed to start negotiations on Double Taxation Avoidance Agreement and expressed willingness to sign the Bilateral Investment Promotion and Protection Agreement at the earliest. Further, Shri Jairam Ramesh also offered the help of Indian WTO experts for Ethiopian accession to WTO. Later, both the Ministers signed the Agreed Minutes.

Ethiopia is the second most populous country of Africa. The current trade between the two countries is to the tune of US $ 170 million. The JTC was held in accordance with the Trade Agreement signed between the two countries on March 6, 1997 in New Delhi. The next Joint Trade Committee Meeting will be held in Addis Ababa at a mutually convenient date.

Press Information Bureau
Government of India
***

The Empowered Group of Ministers (EGOM) on Special Economic Zones (SEZs), at its meeting held here today, has provided guidance to sort out some operational problems relating to implementation of the SEZ Scheme, including the minimum land area requirement and processing area as below, after consultations with all concerned Ministries and Departments:

a) The minimum land area requirement as already notified in the SEZ Rules by the Ministry of Commerce & Industry will remain as it is for the information technology (IT) sector viz., 10 hectares and minimum built-up area of 1 lakh sq. metres for IT;

b) For gems & jewellery, the minimum land area requirement will be 10 hectares and 50,000 sq. metres of built-up area; and

c) For bio-tech and non-conventional energy, the minimum land area requirement will be 10 hectares and 40,000 sq. metres of built-up area.

For all other multi-product, multi-services and sector-specific Zones, the land area requirement will remain the same, as already notified in the SEZ Rules i.e., multi-product – 1000 hectares; multi-services – 100 hectares and sector-specific – 100 hectares.

The meeting of EGOM, headed by Shri Pranab Mukherjee, Defence Minister, was attended by Shri Kamal Nath, Minister for Commerce & Industry; Shri P. Chidambaram, Finance Minister; Shri Dayanidhi Maran, Minister for IT & Communication; Shri H.R. Bharadwaj, Law Minister and Shri Montek Singh Ahluwalia, Deputy Chairman, Planning Commission.

Shri Kamal Nath has said that with the resolution of the issues relating to implementation of SEZs, there would be a significant flow of investment into the Zones.

“Investment of the order of Rs.100,000 crore over the 3 years in infrastructure development of SEZs and in setting up of units therein has been estimated on the basis of projections made by the promoters at the time of seeking approval for establishment of SEZs by them. At present, 15 functioning SEZs (average size 200 acres) have attracted private investment of about Rs.2200 crore in establishment of units and provide employment to about 1.10 lakh persons”, Shri Kamal Nath said.

Approval has so far been given for setting up of 164 new Special Economic Zones in the private sector and by the State Governments. Of the 164 SEZs approved for establishment, 8 SEZs at Mahindra City (IT and textiles) near Chennai (Tamil Nadu); Indore (Madhya Pradesh); Jaipur and Jodhpur (Rajasthan); Manikanchan and Salt Lake Electronic City (West Bengal); and Nokia Sriperumbudur (Tamil Nadu) have become operational in 2004/2005/2006. Further, 5 SEZs at Mahindra City for auto ancillary, Moradabad (UP), Village Vanj., District Surat (Gujarat), Hassan (Karnataka) and Chandigarh are now getting ready for operation. Other Zones are at various stages of implementation.

Foreign Direct Investment (FDI) from France into India will be accelerated and two-way trade between India and France, which is currently estimated at around US $ 3 billion, will be stepped up to US $ 5 billion soon. This was indicated during discussions between Shri Kamal Nath, Union Minister of commerce & Industry and Ms. Christine Lagarde, Minister of External Trade of France in Paris last evening. Ms. Lagarde indicated that the focus of French investment would be in high-tech industries, IT etc. and also conveyed the keenness of France to promote collaboration between small & medium enterprises (SMEs) of the two countries.

Earlier, the two Ministers issued a joint statement at the conclusion of the 14^th Session of Indo-French Joint Committee held in Paris on 31^st May, 2006 welcoming the recent positive trends in trade and investment between India and France and agreed to take concerted steps to further expand bilateral trade and economic cooperation, including finding ways to facilitate movement of business persons, professionals, students, interns and tourists which would help in the expansion of business linkages between the two countries. France also indicated that its proposal legislation on immigration currently under examination by the French Parliament would open new avenues for foreign qualified professional and students to access the French market.

Later, in his address on “India: The New Paradigm”, at International Foreign Relations Institute (IFRI) in Paris, Shri Kamal Nath explained how India has emerged as a leading investment destination with its unique demographic advantage of a large workforce of young professionals, its vast pool of knowledge and skills and its deep- rooted democratic traditions. He also emphasised the need for transparency in action and public policy in an era of globalisation.

Ms. Lagarde assured the Indian business delegation that all investments were welcome in France and denied that French policy was discriminatory.

In his interaction with the French Minister of Agriculture & Fisheries, Mr. Dominique Busseareau, Shri Kamal Nath discussed possibilities of bilateral cooperation in agriculture, especially in food processing industries.

Dr Ashwani Kumar, Minister of State for Industry will lead the Government of India delegation for talks with the senior management of global petrochemicals and chemicals industry being organized at Greenbrier (USA) on June 07, 2006.

With a view to optimizing the gains of competitive advantages that India has to offer in this sector, it is proposed to establish petroleum, chemicals and petrochemicals investment regions (PCPIRS) at various locations. These regions are envisaged as growth engines that will boost manufacturing, augment exports and generate large-scale direct and indirect employment. The PCPIRS operational regime envisages a state-of-the –art infrastructure that would provide conducive and competitive environment for setting up businesses. These regions may be developed in active association with the private sector and would welcome foreign direct investments and expertise. A Task Force on PCPIRS had been constituted in the Prime Minister’s Office to enable coordinated initiatives at the Central and State Government level for the development of requisite infrastructure etc. In pursuance of the aforesaid objectives, that the meeting with the senior management of global petrochemicals and chemicals industry is being organized at Greenbrier (USA).

The delegation will engage with corporate leaders to clarify and explain the thinking of the Government to them. Necessary presentations will be made at this meeting. The Minister will be accompanied by Smt Satwant Reddy, Secretary, Chemicals & Petro-Chemicals, Shri Ajay Dua, Secretary, Department of Industrial Policy & Promotion, Shri Javed Usmani, Joint Secretary, Prime Minister’s Office and Shri K.C. Misra, Joint Secretary, Department of Chemicals & Petrochemicals.

The Petro, Chemicals & Petrochemicals industry in India has recorded a steady growth over the years with India seeking to achieve annual economic growth of 9% and above and the shift of manufacturing base from North America and Europe to Asia, the potential of the petrochemicals industry in India has increased enormously.

Shri Kamal Nath, Union Minister of Commerce & Industry, has said that though India and France are not trading to their fullest potential, economic relations between the two countries are strategically important. For India, France is a significant potential source of FDI, manufacturing culture and good business practices, he said, adding that France invests 40 billion Euro globally every year, but in India the cumulative investment is a miniscule half a billion Euro. He was speaking at the Destination India event organised by FICCI in Paris today.

“Perhaps, what is needed is not only to make French entrepreneurs aware of the business prospects in India but also to create investment regions in India which cater to French expectations. This is what the SEZ Act provides the framework for. This is a golden opportunity for industrial enterprises in France to join hands with their Indian counterparts in creating suitable industrial infrastructure in India, which will make India an irresistible investment location for the French entrepreneurs. Global investors, who come in quicker, stand to gain more than those who hesitate and delay”, he said.

The Minister underlined that India had one of the most liberal FDI policy regimes in the developing world, with almost all activities allowed under the automatic route for FDI upto 100% with no requirement of prior approval and further that India’s FDI policy was also continuously evolving. Emphasising FDI opportunities in sectors like power, telecom, roads and civil aviation, he mentioned in particular India’s new Special Economic Zone (SEZ) Act, which had thrown up opportunities for huge investment that would enjoy tax breaks.

Welcoming recent trends in bilateral trade and investment, India and France have agreed to make concerted efforts to further expand bilateral trade and investment. Both sides have agreed to facilitate the movement of business persons, professionals, student, interns and tourists, as this would help in the expansion of business linkages between India and France. France has indicated that its future legislation on immigration present under examination by the French Parliament will open new avenues for foreign qualified professionals and students to access the French market on a temporary basis. The French authorities are also ready to solve the problems faced by Indian companies on a case by case basis. This is indicated in the joint statement of the 14^th Session of the French-Indian Joint Committee which was signed in Paris last evening by Shri Kamal Nath, Union Minister of Commerce & Industry, on behalf of the Government of India and Ms. Christine Lagarde, the French Minister of Foreign Trade on behalf of the Government of France. The one-day Joint Committee Meeting (JCM) was co-chaired by Shri Kamal Nath and Ms. Lagarde.

Both sides recalled that the visit of the Indian Prime Minister Dr. Manmohan Singh to France, in September 2005 and the visit of President Jacques Chirac to India in February 2006 were strong illustrations of the common commitment to further strengthen bilateral economic and commercial ties. The two governments have also targeted to double bilateral trade within 5 years.

Two-way trade between India and France was around US $ 3 billion in 2004-05, indicating a growth of 26%.

Both sides reviewed market access issues faced by their exporters with the Indian side urging agreement between the French Agricultural Ministry and the Indian Export Inspection Council (EIC) in order to facilitate export of Indian agricultural food and fisheries products to France. India has also pressed for acceptance of the EIC certification, especially for products where specifications have not been harmonised within the European Union (EU).

The French side appraised India about its action plan to promote trade and investment by French small & medium enterprises (SMEs) in India and also indicated that French companies in the financial services and retail sector were eager to invest in India.

The Indian side also urged the support of France for the recognition of Indian whisky by the European Commission.

Earlier, in his address Shri Kamal Nath said that India looked forward to a positive role by France as a leading member of EU on various market access issues relating to Indian goods and services in Europe.

KAMAL NATH TO ATTEND WTO MINI MINISTERIAL MEETING IN GENEVA

SB/NR/MRS

FALL IN IMPORT OF SENSITIVE ITEMS DURING APRIL 2005 -MARCH 2006

SB/NR/MRS

SB/NR/MRS

SB/NR/MRS

DR. ASHWANI KUMAR URGES GLOBAL AND US CORPORATIONS FOR MEGA INVESTMENTS IN INDIA’S PETROCHEMICALS AND MANUFACTURING SECTOR

SB/NR/MRS

Press Information Bureau Government of India ***

DR. ASHWANI KUMAR URGES GLOBAL AND US CORPORATIONS FOR MEGA INVESTMENTS IN INDIA’S
PETROCHEMICALS AND MANUFACTURING SECTOR

Press Information Bureau
Government of India
***