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Friday, July 20, 2018

Finland Ambassador Nina Vaskunlahti interview: ‘Don’t complicate Make in India for us; protectionism doesn’t help in the long run’

Finland Ambassador in India Nina Vaskunlahti said that India-Nordic Summit should help create conditions to boost business relations among India and the Nordic countries.

Written by Sunny Verma | Published: April 17, 2018 1:41:29 am
Narendra Modi, PM Modi sweden visit, Om Modi, Modi Nina Vaskunlahti, India-Nordic Summit, India-EU free-trade agreement, Business news, Indian express Finland Ambassador in India Nina Vaskunlahti.

Finland Ambassador in India NINA VASKUNLAHTI expects that the first India-Nordic Summit, which Prime Minister Narendra Modi is attending, to encourage a rule-based world order and free trade. The two-day summit being held in Stockholm will bring together Prime Ministers of Finland, Denmark, Iceland, Norway and Sweden to discuss how to increase trade and investment flows. In an interview with SUNNY VERMA, Vaskunlahti said the summit should help create conditions to boost business relations among India and the Nordic countries. Excerpts:

You mentioned about the need for free trade, but the proposed India-EU free-trade agreement (FTA) has been hanging fire for nearly a decade now. When do you expect progress on that front?

I am waiting for the news from Brussels because I heard that yesterday (last Thursday), chief negotiators had an informal meeting, and the purpose of the informal meeting was to identify what are the topics that could be possibly discussed. I don’t know what has happened. But I think both parties — India and the European Union — see the value in making progress because in the long run, free trade is beneficial to all parties, in the long run, protectionism doesn’t help. Protectionism might give a short-term boost for certain industries for employment but in the longer run, it will not work out. Free-trade negotiations will not be easy because we are 28 countries at the moment, 27 in the future and there are lots of conflicting interests. But we in Finland think that we should see the bigger picture, (see) India as an important partner in the world with whom free trade would be beneficial. So, this will be our message. But at the India-Nordic Summit, we will not talk about the India-EU trade agreement because our neighbours are not EU members but they also believe in free trade. So, that’s the overall message that we will give.

In this era of growing protectionism, has the time now come to pursue bilateral FTAs and junk multilateral proposals like the India-EU FTA?

No. Finland will always keep on working for multilateral arrangements instead of bilateral arrangements.

Prime Minister Narendra Modi will also have a bilateral meeting with the Prime Minister of Finland. What will be the focus areas of discussion?

The likely focus areas are that we will talk a lot about economy, energy including renewables, education and maybe, nuclear safety issues. India has nuclear power, will be building more nuclear power and the Finnish Nuclear Regulatory Agency is considered to be the best in the world. So, we would be interested in offering the services of the Finnish Nuclear Regulatory Authority to the Indian authorities, on how to run nuclear plants in a safe way. Cybersecurity, maybe also space issues will also be discussed. Finnish satellites that we have launched from India (Bengaluru), so there is a lot of high-level space expertise in India, that’s something where we will find something in common. I always say that Prime Ministers don’t make business but they create the conditions and they give boost for that. I think we will also tell Prime Minister Modi that we are happy to contribute to Make in India but don’t make it too complicated for us, meaning that we are a bit worried about the protectionism policies of the Indian government and hiking the tariffs for certain components, etc. It would be better, as we say, let’s make it a Finn-Indian way, not always Make in India or the Indian way.

Do you find Make in India complicated? What about the hike in custom duties on a number of products announced in the Budget?

It’s the India Budget and the way the Indian government is running the country Budget. All in all, when Finland talks about free trade, we would like to see as little protectionism as possible. If there are tariff hikes, like on certain components that are needed in the IT (information technology) sector or when manufacturing telephones or equipment for network operations, that puts complications on Finnish companies who have invested here, because all the components cannot be found in India thus they need to be imported, so if there are tariff hikes on those it makes the end product more expensive. So, we don’t really like tariff hikes. There are reasons to have those (hikes) and we have to respect those reasons but at the same time, we can give our opinion on it.

What is your view on India’s foreign investment regime?

This is where we would like to give credit to Prime Minister Modi’s government, that they have eased up the way for foreign companies to invest in India and this is what I also hear from the Finnish companies. But still, what is interesting is that while ago we conducted a business climate survey among the Finnish companies and around 70 per cent were saying that they are planning new investments in India in future, but at the same time, 33 per cent were saying that they have found difficulties in operating in India and that has to do with some unclear regulation, unclear taxation, redtape before say setting up a factory. But I know all these issues are being addressed by the government, it will take time before they are resolved. The Indian government is also encouraging to find solutions because they know that foreign investments are needed.

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