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10/01/2003-Inaugural Address by Mr. Yashwant Sinha, Hon’ble Minister for External Affairs

Inaugural Address by Mr. Yashwant Sinha, Hon’ble Minister for External Affairs At the Seminar on South Asian Cooperation organised by the South Asian Centre for Policy Studies, Dhaka

Thank you Mr. Vohra, Shri Gujral, Dr. Sobhan, Shri Dubey, Ladies and Gentlemen.

Inaugural Address by Mr. Yashwant Sinha, Hon’ble Minister for External Affairs At the Seminar on South Asian Cooperation organised by the South Asian Centre for Policy Studies, Dhaka

Thank you Mr. Vohra, Shri Gujral, Dr. Sobhan, Shri Dubey, Ladies and Gentlemen.

Dr. Sobhan was referring to the festival of People of Indian Origin which is going on in Delhi and which was inaugurated by the Prime Minister yesterday. He is quite right in saying that there is a great deal of similarity between what is happening there and what we are trying to do here. We have a shared history. We have so much in common. We are joined together by geography and, therefore, there is no way we can either ignore each other or not afford to be friendly and cooperative. We must live with each other.

But there is an element of geography which is beyond our control -the element that India is a large country and that we have a billion or over a billion people. Just as there is a reality of seven sovereign countries in South Asia, similarly, there is a reality of the size and population of India. Therefore, my first point is that our size and our population need not be held against us. There is nothing we can do about it. It is there. I notice that it arouses some suspicions. It arouses some apprehensions. I hasten to add that these suspicions and apprehensions are not well founded. We have no other desire or intention than to be able to live in peace and friendship with our neighbours and join in the common task of improving the quality of life of our people.

It is with that desire and it is not a new desire that our Prime Minister Mr. Vajpayee when he was the Foreign Minister in 77-79 made a conscious effort to evolve a good neighbourhood policy. He is the one who encouraged me to follow this policy when I took my present assignment. We are lucky today that we have Mr. Gujral amidst us. It was in 1996 in a Chatham House speech that we heard of the famous Gujral Doctrine. India remains committed to the good neighbourhood policy of Mr. Vajpayee. India remains committed to the Gujral Doctrine and today, I would like to say that we are prepared to move further ahead also in the direction of peace, friendship and prosperity with all our neighbours.

I am going to make some suggestions today which I hope SACEPS will take notice of. SAARC was created in 1985 if I am not mistaken. Under the leadership of people like Trilok Singhji, we have been discussing this for over two decades. But unfortunately, we have not been able to make progress under SAARC, the kind of progress which was perhaps necessary, desirable, even inevitable.

Now, when we think of the future, we perhaps have to forget the past. If you want to pick anything from the past, it is perhaps the mistakes that we have made and how we can avoid making those mistakes in future. I am extremely disappointed that after having come formally into existence 17 years ago, SAARC has not been able to move or make progress with regard to its primary objective of economic cooperation between the members of SAARC. With Pakistan, we have a list of only 18 items where we give each other preferential tariff. Just 18 items out of over 7000 tariff lines. With Bangladesh, we have 2672 items where India gives preferential tariff to Bangladesh and we have 484 items where we get preferential tariff from Bangladesh. And as we all know, this is not good enough.

So what should we do? My specific suggestions are India is ready to enter into a free trade arrangement in SAARC, in South Asia tomorrow. I am aware of what happened in Kathmandu at the end of December when we all met to discuss the framework arrangement for a free trade area. Let us make the preferential tariff arrangement irrelevant. There is no point in discussing SAPTA which we have gone on discussing without making any progress. Let us look in concrete terms at a free trade arrangement in South Asia. And, as I said, we will be more than willing to do it tomorrow.

There is a consultant who is going to advice on this matter. The report will be available some time in March. I think there are too many reports and too many Committees which have gone into this in the past. What we need is not another consultant’s report. What we need is political will to be able to move forward. And I am trying to demonstrate that political will on behalf of the Government of India here. We are for a free trade arrangement.

Now there can be two approaches to this: one is the ‘positive’ list approach and the other is the ‘negative’ list approach. I am suggesting the negative list approach. We will not tell each other these are the items or these are the tariff lines where we shall give you a free trade arrangement or a preferential tariff arrangement. I am advocating a ‘negative’ list approach where we shall cover all items except those items where we have reasons to worry about the injury aspects of the domestic industry. If there are any such items, then let us sit down and exchange details of those items on the negative list. I think discussions should be about the negative list. We could look at it as carefully as possible in as I said, a spirit of friendship and accommodation. We should try and keep the negative list as limited as possible. Even within the negative list, we could think in terms of the ‘tariff rate quota’ which is a term well understood in WTO. We can only have so much imports and not anymore until we are able to move forward and remove the ‘tariff rate quotas’. Along with a free trade arrangement for goods and merchandise, we should also have free flow of investment and services within the SAARC area. We cannot have a full-fledged free trade arrangement without free flow of investment and free flow of services. We are making that offer. We are prepared to enter into an arrangement where services and investments will be allowed to move freely. We also need to work carefully on the concept of ‘value added’. We are prepared. On behalf of India, let me tell you that we are prepared to work at a reasonable level of ‘value added’ which will be uniform for all countries in South Asia. The next step will be the harmonization of tariffs where we could sit down. It is going to take time. It cannot happen overnight but harmonization of tariffs is an essential aspect of a free trade area so that we don’t create disadvantages for each other through a discriminatory tariff regime for imports from third countries from outside the free trade area.

You have already suggested that we work together in the World Trade Organization. This is very important if we are knit together as a trading bloc. Then, we should have a commonality of approach to international trade issues and let us work seriously. I share your optimism that when the Trade Ministers meet during the course of this month, they will be able to evolve a common position for the Cancun meeting in Mexico. I am also suggesting that we move forward from SAARC and think of a South Asian Union. If Africa can think in terms of a Union, if the Economic Community in Europe could become an European Union, if ASEAN could make progress, if the countries in Latin America could make progress, there is no reason why we in South Asia cannot become a Union of South Asian states. So, I am putting this idea on table. We will be interested in negotiating a new agreement which will create a South Asian Union and in course of time, the South Asian Union - the SAU will not merely be an economic entity. It will acquire a political dimension in the same manner which the European Union has come to acquire a political and strategic dimension. That is the direction in which I suggest we move. I am not suggesting an end to SAARC but an upgradation of SAARC into a South Asian Union.

All this, as I said, could become possible if were to give up, suspecting each other’s intentions all the time. When I was in Dhaka, I noticed a feeling with regard to the natural gas which Bangladesh has. There is a view that India wants to exploit Bangladesh by asking for that gas. Now, I am referring to it because it appeared to me as an outstanding example of misunderstanding. What is the situation today? We are discovering gas within our own territory. We have offers of gas from the Gulf and from Central Asia. The Indian market will not remain static. There is a dynamics to market forces. Therefore, if we establish trade in gas, it need not necessarily mean exploitation. It will be exploitation of natural resources and not exploitation of one country by another. When I was in Dhaka and when I was meeting with Editors, someone pointed out to me how we could even think in terms of importing Bangladesh gas and sending it back in cylinders to them . Gas is not merely cooking gas as we all know, and it is not merely packaged in cylinders. It has large industrial use and this was envisaged as a major area of cooperation. Something has held it up.

The final point which I would like to make in all humility is the second point of the Gujral Doctrine. We have to be aware and sensitive to each other’s security concerns. We have to be sensitive to the security concerns of South Asia as a whole. But within the overall approach to the security concerns of South Asia, we have to be aware and sensitive of the security concerns of each other. Quite clearly, this is one of the least of friendly things that one would expect. Bangladesh will expect that from India. India will expect that from Bangladesh, and similarly from all our neighbours. And it is quite clear that if those security concerns become overpowering, then many other areas of cooperation are lost sight of temporarily or in the long run. So, sensitivity to each other’s security concerns is an issue which we have to keep in mind.

We must promote people to people contact. But once trade starts moving in the manner in which I am envisaging, then people to people contact will become easier. Connectivity is an extremely important aspect of trade exchanges. You cannot have trade flourishing between nations if there is no connectivity. Therefore, the land route, the sea route, the air route, telecommunications, all these are aspects of connectivity which have to be looked at. On behalf of India, let me tell you that whatever strengths we have built over the years in terms of technology, in terms of human resource development and in terms of capacities, we are prepared to put at the disposal of our neighbours in South Asia. Whatever we have, can be yours, just for asking.

I am quite sure that if we take this road and I am talking of the whole of South Asia. I am not making any distinction between the countries of South Asia. If we take this road, I am quite sure, the misunderstandings of the past will automatically vanish and it will be possible for us to move ahead on the road to prosperity and a good quality of life for our people.

Thank you very much.

 

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