The wisdom, or otherwise, of entering into a spate of free trade agreements (FTAs) with a number of countries, has now been questioned by Prime Minister Manmohan Singh himself.
“We need to examine the effects of the large number of free trade agreements we are entering or planning to enter into. We also need better understanding of the geo-political dynamics which are giving rise to a new range of economic relationships”, said Manmohan Singh at the silver jubilee function of economic think-tank Indian Council for Research in International Economic Relations (ICRIER).
Congress president Sonia Gandhi had written to the Prime Minister earlier this year urging caution while negotiating FTAs, and ensuring that the interests of farming community were be compromised.
But in the same breath the Prime Minister also criticised "some political parties" who often adopted postures that are "out of line with our current interests." He expressed disappointment over the failure of these political parties to recognize "the interdependence of nations in a globalised economy".
"I am often disappointed by the lack of adequate appreciation in our country, including among our political leaders, of the changing nature of our relationship with the world, and indeed with the region around us," he stated. Although he did not directly name any political party, Singh’s remarks are a clear reference to the Left parties' strong criticism of India's nuclear deal with the United States.
Singh’s statement about FTAs comes 10 days ahead of the scheduled meeting of Indian and the Association of South East Asian Nations (Asean) trade officials at Jakarta on November 16 to restart negotiations for a proposed India-Asean FTA. The negotiations had come to a halt over a 'negative' list of nearly 1400 items - of goods which should be excluded from the FTA - that India had submitted. Asean rejected the list, whereupon India the number of items down to 852 and later to 560, but Asean has still to respond positively.
The negative list consists of items such as spices, plantation crops (tea, coffee etc.), vegetable oils ( vanaspati and other edible oils), rich, fish, textiles, chemicals and plastics, electronics, auto components and footwear.
Reports coming from Beijing said that China is a also considering the possibility of an FTA with India,which it might bring up during talks between Chinese and Indian officials when Chinese President Hu Jintao visits India later this month.
The prime minister also noted that the question of India’s membership of the Asia Pacific Economic Cooperation (APEC) would also be looked into. “As APEC is set to invite to new members, we need to study the costs and benefits of APEC membership. We need to look at the effects of a pan-Asian Economic Community or a pan-Asian Free Trade Area”, said Singh at the ICRIER meeting.
India, said Singh, was destined to be more globally engaged and more integrated with its own region. "Even today, our energy security is closely intertwined with our political relations with a wide range of countries around the globe. Our food security, indeed our national security, are closely linked to developments around the world," he said.