Q+A interview with India’s Commerce Minister

Sunday 3rd July 2011

Q+A interview with India’s Commerce Minister, Anand Sharma.

Points of interest:

India’s Commerce minister insists child labour will not be part of free-trade negotiations with New Zealand (contrary to NZ’s position in 2009 joint study)

Sharma abruptly ends Q+A interview when pressed on child labour, calls questions “insulting to India”

“Nobody decides this for India. We are a sovereign country and a democracy”

India-NZ FTA will be based on “a relationship that is based on trust and respect”

As the world’s largest milk producer, India seeks to tap into New Zealand’s agritech sector and “formidable strength” in dairy processing

India to invest over $200 billion in “post harvest management” over three years, which is a “special area of interest” in the FTA negotiations

Confident more NZ “fruit and vegetables” will sell in India post-FTA, but won’t commit publicly to extent of tariff cut

World Bank figures on India’s poverty rates called “not correct”, promises “inclusive growth” with resources “reinvested and redistributed”

Sharma says India’s poverty due to “historical reasons and colonisation; tens of millions of Indians have come out of poverty since economic liberalisation

India will join China and Japan as three Asian economies that will be the world’s largest a decade from now

The interview has been transcribed below. The full length video interviews and panel discussions from this morning’s Q+A can be watched on tvnz.co.nz at, http://tvnz.co.nz/q-and-a-news

Q+A, 9-10am Sundays on TV ONE. Repeats at 9.10pm Sundays, 10.10am and 2.10pm Mondays on TVNZ 7

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ANAND SHARMA interviewed by GUYON ESPINER

GUYON ESPINER
I caught up with Anand Sharma in Delhi earlier this week and first asked what a country the size of India had to gain from a deal with NZ.

ANAND SHARMA - Indian Minister for Commerce and Industry
I don’t think countries engage with each other looking at immediate gains. It’s building a partnership. NZ and India share much in common - not only that both our countries are democracies, but we also have the aspirations to engage with each for the development of our countries. It’s a relationship which is based on trust and respect for each other, considering the fact that a very large number of Indian students are studying in NZ. We have a substantial Indian diaspora of over 100,000 who have made their own enriching contribution to the social, cultural and political milieu in NZ.

GUYON How much of an issue is food supply and food security for India? Is that something that you’re hoping to gain from this deal with NZ?

ANAND I think India is a country which has food security. We are perhaps one of the largest food producers in the world - second, to be precise. Again, we are the second-largest fruit and vegetable producer in the world, and we are the largest milk producer in the world. So it’s not a question of food security. The issue here is that NZ has mastered the technologies in the field of agriculture, including agro processing and food processing and also for post-harvest management, and that is an area which is of special interest to us, because India’s post-harvest losses are high. This is one sector which alone will be seeing investments of over 200 billion within the next three years in India. Besides that, NZ has formidable strength in its technology in milk processing in the dairy sector. I had visited NZ recently, and I went into Fonterra, and we saw the technologies which NZ has, and there is already an understanding reached between Fonterra and the NDDB - that’s the National Dairy Development Board of India. This is one area where we can see a movement in the very near future, besides of course what we trade with each other. That would also see a substantial increase after the trade agreement is concluded.

GUYON Is India prepared to lower its tariffs or taxes, its tariffs on agricultural goods?

ANAND We have a lot of NZ fruits in the Indian market. They are available. I’m sure that after we conclude the free-trade agreement, we’ll see much more on NZ fruits and vegetables coming. I cannot discuss the details with you about the tariffs and how much of those lines will be influenced with the decision, as the negotiators are presently engaged.

GUYON Can we talk a little bit about the state of India’s economy? In the West, there are predictions that India could rival the size of the economies of the United States and China over the next few decades. Do you believe that India is on that sort of path of economic growth?

ANAND Well, that is what you have commented, and your observation would have been based on some studies which have been made by experts and analysts. India is one of the fastest-growing economies in the world. We are the fourth largest in PPT terms. In real terms, in a decade from now, and maybe a little over a decade, of the first five economies of the world, the first three will be from Asia. They’ll be China, India and Japan. Now, that is universally accepted or acknowledged. We are growing well, and we hope that we will be able to continue with this pace, sustaining the momentum. That is also an imperative for India - our commitment to sustainable growth and sustainable development, given the fact that we are home to 1.2 billion people, and there’s already a shift in change that has taken place in the world. When you look at the growth in the emerging economies in the developing countries, the emerging economies are contributing almost half of the global economic output. And in real terms, the GDP of Asia, the GDP of European Union and the GDP of America in the next two years will be equal in size, each contributing 25% to the world GDP. So these are the realities of today’s evolving economic scenario.

GUYON There is clearly still a lot of poverty in India, though, too, isn’t there? The World Bank estimates that some-

ANAND We have not said that it is not there. These are historical reasons. You perhaps may not find it easy to fathom. As I said, a country that is home to 1.2 billion people, and 20% of the world’s children live in India. India is still a developing country. For centuries, India was colonised, but today we have not only access to, but we have our own core strengths in technologies, in innovation and research, and that is what is propelling India forward.

GUYON Sure. I’m just trying to gauge the size of that poverty, though. The World Bank says about three quarters of the population live on about US$2 a day. Is that-?

ANAND Listen, I’m not going to- here to argue about the numbers. We are not disputing, but this number is not correct. So I’m not getting into a debate on this. Let me educate you. I used the words ‘inclusive growth’. Inclusive growth and sustainable development means that as the Indian economy grows, as capacities are built up, as resources are mobilised, they are reinvested to ensure that the benefits reach those people who have been denied access to opportunities and resources for a long time for the historical reasons. Tens of millions of Indians have come out of the poverty net ever since we embarked on the path of economic liberalisation. Today India has more resources which are being reinvested and redistributed. When you look at what is happening in India, it’s a socially inclusive economic agenda. Perhaps that should be properly understood. India has today a programme where all school children are retained in schools for free meals, cooked meals, which are provided by the state. It’s over 127 million children who are retained on every day in the schools. India has also, through a constitutional amendment, given a right to work, right to employment for 100 days for every citizen. So this is something that is our problem, and these are the priorities which we decide. Nobody decides this for India. We are a sovereign country and a democracy.

GUYON I understand that. I understand that. You talked about children there. Um, from the reading that I’ve done, there seems to be perhaps 12 million children aged between 5 and 14 who are in a situation of working - essentially child labour. Is that still a big issue in India?

ANAND We have the laws, we have the best practices, and we have the institutions to implement the laws. India does not encourage- India has forbidden child labour. We are a rule-based and rule-governed country. People should understand the complexities of India’s situation and not try to mock at us.

GUYON With respect, I’m not trying to do that at all. I’m trying to gauge the size of the issue. Is it still true that there are 12 million children who are working in India?

ANAND As I said, 20% of the world’s children live in India. You calculate the number.

GUYON Is it acceptable? Does it happen that you have 5, 6, 7-year-olds who are working in match-box factories, for example?

ANAND I have answered the question. I’m not going to say anything further.

GUYON On that issue, though, do you think that a trade agreement should include provisions to ban child labour or to deal with that issue?

ANAND That’s insulting to India. India does not allow any extraneous matters. There are other platforms to discuss this, not in trade negotiations. Thank you. (SHARMA ATTEMPTS TO HANG UP). (SPEAKING TO SOMEONE OFF-CAMERA) He’s a very rude fellow.

GUYON So, as you can see, at that point, Mr Sharma abruptly ended the interview. India clearly does not want to address the child-labour issue in any free-trade agreement