CITI opposes EU preferential access to Pakistan

07 Dec '10

3 min read

To help Pakistan get over the impact of the countrywide floods, the European Union decided to help the country by providing duty free concessions on a range of goods which the EU imports from Pakistan, including textiles and clothing.

Towards that end, the EU has sought support from India for its proposal for preferential access for around 75 items of textiles and apparels for a period of three years, which has been vehemently opposed by the apex textile body in India; Confederation of Indian Textile Industry (CITI).

Speaking exclusively with fibre2fashion, Mr DK Nair, Secretary General, CITI, said bitterly, “India should out rightly oppose the proposal, since all year around, many countries, including India are hit by calamities, however we have not received packages of this type, so why should Pakistan get the same”.

He added by saying, “The textile industry of India has full sympathy with Pakistan on the tragedy arising from the serious floods it suffered earlier this year. We also appreciate the gesture of EU to assist Pakistan in its hour of crisis. But we have concerns on the means selected by EU for such assistance.

“By adopting the 'trade for aid' approach for assistance, EU has effectively transferred the burden of such assistance to the other countries like India, exporting these products to the European markets. Instead of absorbing additional imports from Pakistan, the zero duty access will only substitute imports from other countries like India with imports from Pakistan.

“This raises serious issues of equity. This measure also clearly violates the principle of General Most Favoured Nation Treatment stipulated in Article I of GATT 94 (which is part of the WTO Agreement). The proposal with reference to Ethyl Alcohol, covered in Annex II of the proposal would also violate the principle of Non Discriminatory Administration of Quantitative Restrictions stipulated in Article XIII. Therefore, EU is bound to seek waiver of its obligations under these WTO provisions from the General Council.

“It is pertinent to note that India has suffered substantially more severe natural calamities in the past. In fact, floods themselves have been more severe in India almost every year, in terms of loss of lives and property. Many other countries exporting these products to the European markets have also suffered natural calamities of varying severity in the past. The trade concessions being offered to Pakistan now have not been provided in any such cases. This is a clear discrimination in favour of Pakistan.

“The textile industry of India would, therefore, request government to take a strong position against the waiver for the EU proposal, when the issue comes up in the General Council of WTO. India on its own can block the waiver since WTO decisions are always taken on consensus basis. However, we would request that cooperation of other WTO Members affected by this proposal may also be garnered for blocking the waiver”, he concluded by saying.

Fibre2fashion News Desk - India

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