India and New Zealand are hoping to ramp up bilateral trade of $1 billion dollars to $3 billion by 2014 when the two countries conclude a Free Trade Agreement (FTA).
India’s Minister of Commercer Anand Sharma and New Zealand Minister of Trade Tim Groser concluded two days of talk to propel trade and economic relationship between the two countries.
Both ministers agreed that negotiations for the bilateral free trade agreement should be concluded within an 8 to 10 month time frame. “The FTA will be our single most important bilateral platform for increasing trade. More open access and investment flows can come from the FTA,’’ Groser said. Both Ministers affirmed that conclusion of the FTA would provide the impetus for each country to realise the full benefits of their mutual economic potential.
Minister Sharma noted the proposed FTA was a logical extension of India’s “Look East” policy. Both Ministers recognised the strategic importance of the increased economic integration in the Asia-Pacific region.
Sharma noted that New Zealand is already an important trade partner of India in the energy sector. There are also important trade complementarities in the agricultural sector. He said what is important is also to deepen the relationship in the services trade, and bilateral investment, and build on the possibilities of cooperation in innovation and technology transfer.
He indicated that the services sector constituted a major portion of India’s GDP as well as exports and consequently India hoped that New Zealand would provide a growing market for India’s IT enabled Service sector.
Financial services, tourism and education were also identified as very promising areas of bilateral cooperation.
Sharma called for a more liberalised regime to be put in place to allow greater inter-firm mobility for professionals, and to promote dialogue on mutual recognition arrangements and social security arrangements. He called for a working holiday scheme to be put in place between India and New Zealand.
The First Green Revolution has made India self-sufficient in food grain production and that India was now looking towards embarking on a second green revolution which would convert India into a country exporting food grains, fruit and vegetables. He mentioned that productivity in agriculture in India is still low and accordingly India was looking for technical solutions to enhance its productivity.
Sharma noted that India welcomed investment in a broad range of sectors, including agri-processing, food processing, post-harvest technology transfer in refrigeration, cold chains, storage and logistics for minimizing post production losses. He also pointed out that India allowed 100 % FDI in the field of agriculture processing.
He believed that New Zealand had a lot to offer in these areas and stressed that both countries can work very closely in revolutionising post-harvest management logistics in India.
He invited cooperation in the fields of pharmaceuticals, engineering goods, textiles, spice trade and film making. He specifically stressed that the Indian pharmaceutical industry has established itself in world markets for its high quality, at the same time ensuring availability of generics in a manner that makes health care more affordable for vulnerable sections of the world population. He suggested that India’s high quality health sector could help countries like New Zealand to bring down their public health costs.
Groser stressed that New Zealand’s interests in dairy and apples were complementary and not in competition with Indian goods. He explained that the sheep wool from New Zealand goes into carpet making and hence boosts Indian exports. He therefore felt that India needed to liberalise trade access and that investment would follow as a result.