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Kathmandu Monday October 01, 2001 Ashwin 15, 2058.
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Talking trade talks
Nepal-India trade talks in Delhi over the
weekend have floundered despite assurances by Indian Foreign Minister Jaswant Singh during
a recent visit here that matters would basically be smooth sailing. The joint-secretary
level talks ended without any consensus. Talks will resume within the next month at
secretary level. The Indian side will then put forth demands in writing for inclusion of
provisions on rules of origin and export surge. It was the question of export surge that
helped derail the previous round of trade talks, held in Kathmandu in August. This issue
has now come up again, and this time India has also brought in the question of rules of
origin. Although this is not the first time rules of origin has figured in mutual trade
discussions, it is now being used to up the ante. In the past the Indians have invoked
rules of origin to scuttle Kodak operations out of Nepal. Rules of origin, like the so
called cross border unauthorized trade, is turning into a stock in trade for needling
Nepal needlessly, and these will now be joined by export surge. Indians, with their
greater intellectual resources, will always find some excuse or other to keep Nepal at the
receiving end. One recalls well the way India has tried to turn the tables on us over the
question of trade deficit. With India’s immensely larger industrial base Nepal has
always been a net importer of Indian products. But the Indians would have us naively
believe that the deficit favours Nepal and cited figures to prove their point, whatever
the authenticity of those numbers. Against this lopsided picture, a point that has clearly
emerged at the just ended Delhi talks is that at the end of the day matters have to be
decided at the political level. It is there that the real give and take between Nepal and
India takes place, with Nepal invariably doing most of the giving. Everything else flows
from this.
That aside, part of the problem of trade between
Nepal and India will resolve itself one way or another once we join the World Trade
Organisation. Whatever the pros and cons of Nepal entering into that global arrangement,
one thing it should do is help put our foreign trade within an international framework.
India will no longer be able to impose all its views on a lone Nepal. Part of the solution
lies in better-book keeping on our part so that trade figures are in black and white that
India cannot be dismissive about. That’s for the long term. For the problem at hand,
what is Nepal going to tell India when secretary level talks take place next month? We
will have to do better than keep harping on the spirit of the trade treaty between the two
countries. The Indians are quite capable of jettisoning any such spirit when it suits
their purpose. For example, suggestions proffered by the Joint Economic Council of the
Confederation of Indian Industries and the Federation of Nepalese Chambers of Commerce and
Industry were given short shrift in Delhi the other day. A more realistic approach might
be to face the export surge issue head on, see how the notion might cut both ways, show
India how Indian goods and produce has damaged parallel sectors of our economy, and decide
if after all this the Indians still have a case. The idea is to get down to the nitty
gritty rather than stick to lofty principles alone.
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