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India, China telecom dispute won’t hurt ties

India, China telecom dispute won’t hurt ties
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First Published: Wed, May 19 2010. 09 34 AM IST
Updated: Wed, May 19 2010. 09 34 AM IST
New Delhi: Union commerce minister Anand Sharma has said a dispute over restrictions on the import of Chinese telecom equipment will not hurt commercial ties between the world’s two fastest-growing economies.
India has banned mobile phone operators from placing orders with ZTE Corp and Huawei Technologies over security concerns, industry sources say, sparking fears of retaliation from India’s largest trading partner.
The move underscored a lingering mistrust between the Asian powers despite booming commercial ties in the past decade and a recent display of solidarity on global climate change.
India has long sought greater access to the Chinese market to help narrow a trade deficit in China’s favour that ballooned from $1 billion in 2001-02 to $16 billion in 2007-08, according to data from Reserve Bank of India.
“I see no reason why it should hurt the trade ties,” Sharma said in an interview with Reuters Insider television, when asked about the restrictions on equipment. “We have to take a macro view on these matters and not look from a narrow window of one particular company and one particular subject.”
Beijing has signaled it is willing to give greater market access to Indian companies, especially in the services and pharmaceutical sectors where India is competitive, he added.
The government ministers, including Sharma, have repeatedly denied any country-specific ban on telecom equipment, though the environment minister broke ranks to government call policy toward Chinese investments defensive and paranoid.
No dilution of world trade talks
Sharma also said progress in the Doha trade talks was “very slow.” Critics in developed countries had blamed India for the collapse of the talks in 2008 due to a row over agricultural and industry tariffs.
When Sharma took over as minister last year, he had sought to inject fresh momentum into the global negotiations. The talks have missed every deadline since their inception in 2001 and look certain to miss the latest one set for 2010.
The United States says it wants greater market access from the likes of India and China before it can agree to any deal, and on Tuesday went as far as to say Doha faced “a key roadblock” from developing countries such as India.
Asked whether India would show more flexibility in light of the US demands, he said: “This is not a round in which the aspirations, which are legitimate, of the developing countries ... have to be diluted in any manner.”
Sharma also ruled out renegotiating those portions of the talks on which he said agreement had already been reached.
“There have been suggestions, which have come, for further revisions. We have made our position very clear ... that revisions should not mean a reopening of positions which have stabilized,” he added.
India is seen growing at around 8.5% in the 2010-11 fiscal year, as Asia’s third-largest economy rebounds from the global economic slowdown. Sharma has set a target for India’s exports to grow nearly 15% after a decline last year.
He also played down fears the euro zone debt crisis could derail India’s economic growth and export prospects this year.
“We are heading for 8.5%. I don’t see that being changed in any manner,” he said.
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First Published: Wed, May 19 2010. 09 34 AM IST