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July 8, 1998


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Avoid confrontation on trade issues, panel tells Govt

The parliamentary standing committee on commerce has asked the government to ''avoid major confrontations'' on trade-related issues with international trade and financing institutions as well as the developed industrial countries while taking care that the nation's sovereignty, dignity and long-term interests are ''not unduly sacrificed.''

In its 33rd report presented to Parliament by Chairman Ashok Mitra, the committee noted that the catchword for the World Trade Organisation is freeing international trade from all restrictions.

To set up its own industrial and agricultural infrastructure without the shield of protection poses an enormous challenge for any developing economy. The challenge is equally ''formidable'' for India, the report said.

The problems facing the country have been further aggravated in recent weeks because of the stance adopted by the G-8 nations in the aftermath of the Pokhran explosions.

Two specific obligations have developed on the country under the provisions of Article 70 of the WTO treaty -- one relates to providing a means for filing applications for patent protection for pharmaceutical and agro-chemical products even during the transition period.

Another obligation relates to grant of exclusive marketing rights during the transitional period to the applicant parties, on fulfilment of certain conditions.

To satisfy the obligations under these two provisions, the Indian government had promulgated an ordinance on December 31, 1994. But due to various reasons no legislation could be enacted in the matter as the Bill, replacing the ordinance, had lapsed with the dissolution of the Lok Sabha.

Taking advantage of this lacunae, the United States filed a formal dispute against India on the ground of non-implementation of the WTO obligations. India lost the case in the dispute settlement panel and also the appeal filed against the decision of the panel.

India is now under pressure to implement the verdict of the dispute settlement panel within a period of 15 months from January this year, when the appellate authorities's decision was announced, the committee pointed out.

Therefore, the committee was of the opinion that it would not be ''unfair if an effort is made by our government to persuade the WTO to grant an extension of the period for re-consideration before india communicates its final decisions to the world trading body.''


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