Aso bats for EPA with India but pact may not be signed during PM`s visit

Tokyo, Oct 21 (PTI) India and Japan have made
"substantative progress" in their negotiations on the proposed
Economic Partnership Agreement (E.P.A.), says Prime Minister
Taro Aso but the pact is unlikely to be signed during Prime
Minister Manmohan Singh's visit to Tokyo.

Aso said the planned agreement will become the
"trigger" for expanding bilateral economic ties.

"E.P.A. is one of the most important issues. I would
like E.P.A. to become the trigger for further development of
the economic relations between Japan and India, Aso said.

"In order to do so, E.P.A. needs to be of a high
quality and beneficial to both countries."

"We have seen substantive progress in our E.P.A.
negotiations and I am looking forward to discuss this matter
with Prime Minister Singh, based on the negotiations the two
countries have had so far," Aso told PTI in an e-mail
interview ahead of Singh's official visit from Oct 21 to 23.

India and Japan have been negotiating a E.P.A. for the
last two years with an objective of giving a boost to the USD
10 billion bilateral trade by way of eliminating and slashing
duties on as much as 90 percent of the goods and services
traded between the Asian countries.

While the trade negotiators have completed several
rounds of discussions, they have not been able to reach a
complete agreement. Both the sides have areas of concern that
include the rules that will govern the value added third
country goods, quality standards and the negative areas to be
shielded from the breaking of the tariff wall.

Describing the Indian market as "quite huge," Aso said
it has been growing at an astonishing pace in recent times.

"The Japanese companies are keenly watching its
development."

It is only natural that Japan and India, the largest
and the 3rd largest economies respectively in Asia, should
further deepen their economic ties, Aso said.

"We cannot say, however, that the size of their
economic relations is large enough considering the size of
their economies."

In 2007, for example, India is Japan's 27th largest
trade partner, and the share of Japan's trade with India in
its total foreign trade is merely 0.8 percent, he pointed out.

"We should, therefore, try to enhance drastically the
economic relations between Japan and India through all means,
and we have many bilateral economic co-operation on the agenda
during Prime Minister Singh’s visit, Aso said.

Ahead of Singh's visit, industry body Federation of
Indian Chambers of Commerce and Industry (F.I.C.C.I.) had also
sought immediate tariff elimination by Japan on products of
export interest to India.

Japan has high tariffs on items like leather,
textiles, marine and chemical products, the chamber said.

Although Japan has zero duty on around 30 percent of
its chemical and pharmaceutical products, its stringent
approval and product registration act as a barrier to Indian
exports. PTI