March 14, 2003	Friday	Muharram 10, 1424

NEW DELHI, March 13: EU Trade Commissioner Pascal Lamy on Thursday called for a narrowing of differences between developed and developing countries on trade, investment and market access, to ensure success at the upcoming Cancun round of WTO talks.

However, despite a day of intensive talks between European Union and Indian trade officials, little progress was made in bridging differences on key topics on the World Trade Organization (WTO) agenda, officials said.

“The World Trade Organization (WTO) does not mean immediate tearing down of tariff barriers but means progressive opening and with necessary safeguards,” Lamy told Indian business chiefs and industrialists.

“So the WTO is a guarantee for the country that wants to avoid losing control over the process of liberalization and market opening,” he said.

Urging developing countries, including India, to open up their markets, Lamy described as a “misconception” the view that poor countries face “rich country protectionism that is more acute than their own”.

“Trade barriers of poor countries against one another are significant restraints on their own development — more significant than those imposed by rich countries,” he said.

The EU, would be willing on its part, to address concerns of countries such as India.

“The EU obviously has to further open its markets in agriculture, to address peak industrial tariffs, tariff escalation and so on.

“We will do so in return for increased openness from developed countries, but also developing countries,” he said.

Lamy recalled that the EU has proposed a 45 per cent cut in export subsidies, a 55 per cent reduction in aid for agricultural products and an average reduction of 36 per cent on customs duties.

But he ruled out dismantling the EU’s Common Agricultural Policy.

The EU and Japan, both heavy farming subsidizers, are heavily criticized by other members of the 145-strong WTO for their level of domestic support to farmers.

In a bid to allay concerns about opening up the economy, Lamy said WTO talks in Doha in November 2001 had ensured that liberalization would be progressive — which meant, he added, a process “that each country can handle in terms of its domestic and international competitiveness and development priorities.”

In his speech, Lamy described the role of Indian businessmen as crucial and urged them to support the WTO talks.

The next round of WTO negotiations between developed and developing countries will be held in Cancun, Mexico, in September.

Lamy, who arrived here late Wednesday, met Indian Commerce Minister Arun Jaitley on Thursday and was also scheduled to hold talks with Foreign Minister Yashwant Sinha, an EU official said.

An Indian official had said India would raise the differences between India and the EU on trade and investment, competition, greater transparency in government procurement deals and trade facilitation.

Disagreements on these issues had proved to be stumbling blocks at the WTO’s Doha round of negotiations.

Officials said India and the EU had during meetings on Thursday reported some convergence of views, but that full agreement had yet to be reached.

Lamy in his speech to the Federation of Indian Chambers of Commerce and Industry (FICCI) said resolution of these issues could “send a strong signal to foreign investors that there is a transparent and predictable framework for their operations in place in India.”—AFP