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WTO: India issues warning on 'July approximation' draft
New Delhi: India will reject the "July approximation", a crucial accord among all 148 WTO members on the broad parameters of the ongoing negotiations on the Doha round, if interests of the developing countries are not addressed, Commerce and Industry Minister, Kamal Nath said in his keynote address at UNCTAD stakeholder consultations on non-agricultural market access (NAMA) here.

"If we find that this (July approximation draft) adequately reflects our concerns and interests, we shall support the move for finalising the July approximation; if not there would be no point in such an exercise and we shall oppose it," he said.

The Swiss-type tariff reduction formula suggested by Argentina, Brazil and India (known as the ABI formula) satisfies the requirements of the July framework and the same time takes care of the concerns of developing countries.

A Swiss formula is one that results in deeper cuts in higher tariffs, and that harmonises the tariff lines around the co-efficient chosen. The bigger the co-efficient, the less steep the cut. Thus, the whole negotiation boils down to a "choice of co-efficient". But "having the same coefficient for developed and developing countries in any way is ruled out", Kamal Nath said.

India has also rejected the US formula wherein the developed countries accept that developing countries can have a higher coefficient than developed countries, but they insist that these two coefficients must be within sight of each other. "We have rejected this outright, because though on the face of it, it seems that the principle of less than full reciprocity is being accepted by permitting us a higher coefficient, in fact, by keeping the two coefficients within the sight of each other, the developing countries end up making proportionately deeper cuts than developed countries," he said.

He said India would resist any attempt to impose an artificial, overarching harmonisation for which there is no mandate The minister said just because India was autonomously reducing its tariff on industrial products, the developed countries could not be allowed to use the voluntary exercise against us. India is autonomously reducing its tariff on industrial products. This year the average tariff on non-agricultural products is down to around 15 per cent.
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US and India sign ten-year framework on defence
Washington: India and the United States have signed a "new framework for the Indo-US defence relationship for the next ten years". The framework includes "new opportunities for technology transfer, collaboration, co-production and research and development".

The agreement was signed by visiting Defence Minister Pranab Mukherjee and American Defence Secretary Donald Rumsfeld.

It defined the goals as strengthening "our countries' security, reinforce our strategic partnership, and build greater understanding between our defence establishments."

"Both sides agreed that US-India defence relations are an important pillar of their transforming bilateral relationship," a statement said. The framework stated that both India and the US were entering a new era, "transforming our relationships to reflect our common principles and shared national interests". It said the defence relationship would support and would be part of the broader US-India strategic partnership.

It acknowledged that defence between the two nations had advanced to "unprecedented levels of cooperation". The two sides also agreed to expand collaboration relating to missile defence.

The framework also stressed increased cooperation in the areas of worldwide peacekeeping operations, defence strategy, intelligence exchanges and military response to disaster situations.
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Chidambaram asks states to mobilise resources
New Delhi: The finance minister, P Chidambaram, has called upon the states to take steps for resource mobilisation and has expressed his concern at the functioning of rural cooperative banks as well as high non-performing assets (NPA).

Briefing reporters after his presentation to the National Development Council (NDC), Chidambaram also announced that the government will for the first time present an "outcome budget" to gauge the effectiveness of the money spent on various heads under different ministries. "In the first week of July, we will come out with an outcome budget," he said adding that this would help allocate resources based on progress in delivery. The exercise would make departments and ministries more accountable, he added.

Asserting that the economy was in a "resilient" mode, Chidambaram told the NDC meeting that inflation was under control, but the challenge was to mobilise resources to rev up investments. He admitted that the country was short as far as planned investments were concerned, citing that only 50 per cent of the MTA targets could be achieved in the first three years.

He also asked the chief ministers to carry forward pension reform as the liabilities of both the Centre and states was expected to cross a staggering Rs100,000 crore by 2009-10.

"The PFRDA (the Pension Fund Regulatory and Development Authority) Bill has already been referred to a Parliamentary Standing Committee and nine states, apart from the Centre, have implemented the new defined contribution pension scheme," he told reporters.
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