Fm Asks Saudi Arabia To Lift Trade Barriers

Finance minister P Chidambaram yesterday urged Saudi Arabia to remove barriers to Indian imports, but a Saudi minister denied the barriers existed.Indian businessmen have told me that they face stated and unstated barriers, Chidambaram said at a seminar on boosting bilateral trade, attended by Saudi industry and electricity minister Hashem bin Abdullah bin Hashem Yamani.

I am ready to concede that there is no intention to discriminate against India. But institutional constraints and built-in constraints may have the unintended consequences of discriminating against the products of developing countries, Chidambaram said. He cited Saudi regulations on drugs and pharmaceuticals imports as an example, saying Indian drugs were sold in more than 30 countries.

 

I have no doubt Indian companies can meet any standards set by Saudi authorities and will pass any tests that are laid down in certification, the finance minister said. So is the case with agricultural products and meat products. These are areas where India has strengths and India, therefore, seeks market access, he said.

But Yamani, who spoke immediately after Chidambaram, was cool to the Indian ministers appeal.The institutional constraint is non-existent in Saudi Arabia, and maybe the conception that it does exist has prolonged the difficulties between our countries, Yamani said.

There is a possible misunderstanding in the qualification procedure Saudi Arabia demands in the goods that come from all countries, big or small, Yamani said.

Saudi Arabias pharmaceuticals import laws stipulate that exporting firms R&D capabilities be proven in the US, Indian foreign ministry officials said.

The barriers on drugs and pharmaceuticals are indeed institutionalised because specifications have been drafted with an eye on Western companies, an official said. And we have a real problem with meat exports.

He said the Gulf state, where Indians form the largest expatriate community, had clamped strict restrictions on Indian meat imports, fearing that India was unable to accurately verify the health of every head of cattle in the sprawling nation.

Both Yamani and Chidambaram said they wanted bilateral trade, which grew 40 per cent to $3.1 billion in 1996, to be based on a larger basket of goods. Saudi Arabia traditionally exports petroleum goods and India agricultural products.

Yamani said Saudi Arabia was an open market and the flow of trade information between the two nations was the real barrier to increased commerce.

If this constraint is lifted, I think there is no barrier that can stand between the flow of goods and services between the two countries, the Saudi minister said.

Indian foreign ministry official said: There is actually a difference in perception because we have too little contact with each other. In a way they are saying, if you know our rules, youll know how to work around them.