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Shourie roasts US, EU at India lunch
BS Correspondent in Davos, Switzerland | January 24, 2004 12:53 IST
Arun Shourie took on western critics of India at a plenary session of the World Economic Forum's annual meeting in Davos and at the India lunch on Friday, firmly putting the blame on the United States and Europe for the failure of trade talks at Cancun, and rejecting the charge that India continued to be protectionist in its position at the trade talks.
Drawing spontaneous applause from the audience at the plenary session, Shourie pointed out that the agriculture proposal that had been sponsored by the US and European Union meant that while the developed economies would have to reduce their agricultural tariffs by only 20 or 25 per cent, the developing countries would have to reduce their tariffs by 70 per cent.
He said that even the latest initiative by the US trade representative, to restart the stalled talks, did not show real change on any substantive issue.
Speaking rhetorically at the India lunch, which drew a full house, he asked how there could be progress at Cancun or anywhere else if a rich country like the US could not stand up to pressure from 25,000 cotton farmers, while four whole economies got wiped out because of the American protectionism on cotton.
A western trade diplomat responded by saying that countries like India were mistaken if they thought they were going to get something for nothing out of the Doha round.
"Calling it a development round is a misnomer, it is not about development and India will have to drop its farm tariffs by large margins, there is going to be pain," he added.
Shourie argued at one of the sessions that the new protectionist pressures and the political backlash that India faced in the areas where it has been successful, were an index of the success that the country had achieved.
"It is all very well for the western countries to sound positive about the changes in India, but every time some action has to be taken by them, the response is something else," he said.
Shourie has been speaking at seven or eight different sessions at Davos, against the backdrop of an annual meeting where there is a new buzz about India, mostly about its successes in software and pharmaceuticals, but spilling over into a broader realization that economic power is beginning to shift to India and China, even though the western countries will remain the wealthiest for many decades.
"We are seeing a divorce of wealth and economic power," one western participant commented.
The new mood was clear at a dinner session on Thursday, which focused on India and China, but speakers from the two countries decided to pull their punches and each to be polite about the other.
N K Singh, member of the Planning Commission, underlined the point that the rivalry between China and India was positive because "a horse runs fastest when it is trying to overtake the horse that is in front". He argued that it didn't matter who was doing better, the important point was that together the two countries would change the world.
Chinese speakers at the dinner were equally polite about India, underlining the advantages it enjoyed in software because of the mastery of English and saying in response to a question that a foreign investor interested in automobile components would be better off investing in India.
C K Prahalad, the business guru from the University of Michigan, was one of the speakers at the India lunch on Friday and argued that India was right to be confident about itself, but that this should not turn into arrogance and claims that the country had become a superpower in any field. "Be confident and humble and take the money," he advised, raising a laugh.
"We need to do 10 per cent economic growth, and create 10 million jobs a year," Prahalad said, and advised companies to focus not on best practices but on 'next practice'.
By way of illustration, he said "The Jaipur foot costs $30 and is as good or better on 28 parameters than an artificial foot that costs $9000 in the US."
He underlined the point that companies had to innovate in order to service an Indian market that is still dominated by the poor.
"There is both demand and capital in India, the answer is not foreign investment," Prahalad argued.
But despite the many ways in which a variety of speakers have sought to establish that India is a changed country-from the new shopping malls to the youthfulness of its population -- questions have focused on the poor transportation system, the caste factor and what is seen as Indian protectionism -- making it clear that changing longstanding impressions of the country will take time.