Financial Daily from THE HINDU group of publications
Tuesday, Apr 06, 2004
Industry & Economy
`Keep a watch on WTO textile agreement implementation'
New Delhi , April 5
THE International Textile and Clothing Bureau (ITCB) has asked developing country members to maintain focus on "full and faithful implementation" of the Agreement on Textiles and Clothing, besides being vigilant to disguised form of protectionism once the existing quota regime is dismantled on December 31, 2004.
Welcoming the delegates to the three-day ITCB's Council of Representative meeting that began here on Monday, the ITCB Chairman and India's Ambassador to WTO, Mr K.M. Chandrashekhar, urged the members to be prepared to deal with the issues that still remain of concern.
These include, he said, the upcoming major review of implementation of the agreement in different WTO bodies, the non-availability of carry-forward quotas and the European Union's decision to widen the scope of its quota restrictions to the markets of 10 more countries that are set to join the EU from May and the administrative arrangements that were part of the quota regime which remained another layer of non-tariff barriers to exports of textiles from developing world.
ITCB is an inter-governmental body of developing countries in the export of textiles and clothing. Over 80 delegates from various countries, besides representatives of WTO, UNCTAD, International Trade Centre and trade association of various member countries have been taking part in the New Delhi meeting.
Stating that protectionism would not be phased out on January 1, 2005 with the phase-out of the quota regime, he said that unwelcome developments in anti-dumping and rules of origin had become a reality. Developing countries could foresee "a major challenge" to reducing the tariff peaks, which saw Bangladesh pay almost as much in US customs duties as France last year, despite a huge disparity in trade volumes.
The ITCB Chairman said while France paid $325 million (Rs 1,430 crore) on its of exports to $29 billion to the US, Bangladesh had to fork out $302 million on its exports of only $2 billion. "We should look upon the Doha Development Agenda as an opportunity to counter some of these restraints to our trade," he added.
Thirdly, he said, members should deliberate on how best "we can press for further liberalisation of trade in the sector utilise ITCB resources to our mutual advantage" as trade in textiles and clothing stands at over $350 billion. With the end of quota, this was bound to expand, he said adding this would increase further still "if we can consolidate this gain and secure a good outcome on tariffs in the context of the Doha Round."
In his main address, the Member-Secretary, Planning Commission, Mr N.K. Singh, cautioned the textile exporting countries to be vigilant over other forms of trade restrictions that would spring after the expiry of the quota regime by the end of this year. These disguised forms of protectionism could be like visas, transhipment and anti-dumping measures.
Pointing out that the transition to the quota-free regime would be smooth and painless as possible, Mr Singh said the demand for textiles and clothing would go up in Asia, Africa and Latin American countries.
In his remarks, Commerce Secretary, Mr Deepak Chatterjee, said that the end of protectionism does not guarantee disappearance of protectionism. He urged the developing world to resist any bid to extend the quota regime beyond the scheduled end. He stressed that the liberalised trading regime in textiles and clothing would bring economic and human development benefits to the people of the developing world.
The Textiles Secretary, Mr S.B. Mohapatra, who presided over the inaugural, appreciated the role of ITCB. He said the integration programme implemented by the importing countries has not been in line with the spirit of the Agreement on Textiles and Clothing though it might have conformed to the narrow technical and legal requirements of the pact.
He said the major importing countries had back loaded the integration process and the bulk of integration would occur only in the final phase of transition. He said the far-reaching changes in the market place because of liberalisation beyond 2004 have provoked genuine fears as to whether the fruits of free trade would be available to trade and industry in developing world considering the frequent recourse to trade defence measures by the developed world.
He said tariffs on textiles would continue to draw attention during the WTO market access negotiations since in the major markets the textile tariffs remain more than average tariffs.
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