Govt in process of extending FTA among Asian nations: Minister

Mumbai, Mar 20 (UNI) The Centre is in the process of setting up a joint study group for conclusion of Free Trade Agreements (FTAs) with major asian nations such as Malaysia, Indonesia, Japan and South Korea and also examining the ways to develop regional trade arrangements with China, according to Union Minister of State for Industry Ashwin Kumar.

Addressing a session on ''India' new trade partnership'' at the 16th Asia Society's Corporate Conference here today, Mr Kumar said all these FTAs would be a part of the South Asia Free Trade Agreement (SAFTA) that could be extended to the Gulf Cooperation Council (GCC). ''India is determined to be a leader in this century that beckons Asia''.

In fact, the Minister said, the recent agreement with the US was aimed at ending India's nuclear isolation and would ensure a quantum jump in our energy generating capacity with a consequential impact on our GDP growth which is poised to scale up to 9-10 per cent in the next few years.

The new partnership with the US encompasses India's participation in the future generation programme for zero emission thermal power plants and the integrated ocean drilling programme for gas hydrates.

The relationship would also expand the scope in the capacity building in the fields of agriculture, economic and trade cooperation and also biotechnology.

Mr Ashwin Kumar was also very optistic over the flow of foreign capital into the country, particularly with the announcement of the Prime Minister that his government is working on the course making the Indian currency convertible in capital account mainly the areas of special economic zones and also core sector of the economy.

''Full Capital Account convertibility, as and when the Government decides, will be so regulated as to ensure prudent fiscal and macro-economic management and capital resources'', he clarified.

In this context, he said, the SMEs sector mainly in the manufacturing activities, are the focussed areas for the Government to infuse capital for modernisation and efficient management to boost economic growth.

''One per cent growth in manufacturing sector would lead to three per cent growth in services sector'', he said observing that it has huge potential in creating jobs for million of people mainly in small towns across the nation.

The Government also decided to increase the fund allocation from Rs 650 crore in 2005-06 to Rs 1,150 crore in the coming fiscal year under the industrial infrastructure upgradation scheme (IIUS) and the money would be utilised at major SMEs clusters in the country for the development of common utility facilities such as R&D, water treatment plant, power plants and quality testing labs.

While for a coalition government it may take certain time to implement the policy decision, he said, his ministry is determined to push up the manufacturing growth from the current 9 per cent to over 12 per cent by the end of 11th five year plan ending 2012.

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