On Sonia’s FTA concern, PM said nothing to worry

On May 5, however, when the PM addressed the Asian Development Bank AGM at Hyderabad and announced India’s intention to press ahead with FTAs in Asia, it was well after he had assuaged Congress chief Sonia Gandhi’s concerns over FTAs hurting farmers’ interests.

In fact, Singh had replied to Sonia’s letter on April 20 assuring her that farmers’ and India’s interests would be protected in the FTA with the ASEAN countries. The experience with FTAs, he had noted, was positive the world over and any decision would be taken keeping in mind India’s geopolitical and economic interests.

Thereafter, the Prime Minister also chaired a meeting of the Trade and Economic Relations Committee (TERC) on May 3, where he discussed the issue of the negative list in the FTA and the rules of origin issue as well.

Ramesh is not part of the TERC and the commerce ministry is represented by Commerce and Industry Minister Kamal Nath. When contacted, Ramesh said: ‘‘I have read about the letter (in the newspapers) where she has expressed concerns on the FTA and I’m sure they will addressed.” Asked if he had helped draft the letter, he declined to comment.

Currently, the Indo-ASEAN FTA is still under discussion. There are around 900 items on the negative list, amounting to one-third of tradeable items being out of the scope of the proposed agreement. Added to that the TERC also discussed the rules of origin issue to ensure that goods from say China are not routed through the ASEAN countries.

The argument being given by detractors of the FTA is that the bone of contention is that it is lopsided and unlike the one with Singapore, it includes only goods and does not include service industry and investments.

Sources who attended the TERC meetings on the ASEAN FTA said India wants services to be included but the ASEAN countries are resisting the same and want to initially limit it to goods alone.

kandula.subramaniam@expressindia.com