India, Singapore to set up free trade zone

By Our Special Correspondent

NEW DELHI, JAN. 19. India and Singapore are likely to set up a joint task force to work out modalities for creating an Asian free trade zone.

The Finance Ministers are likely to head the task force. The two countries have also decided to set up another task force to identify areas of convergence and cooperation in the Information Technology sector.

The suggestion for a free trade zone came from the visiting Prime Minister of Singapore, Mr. Goh Chok Tong, who conveyed it to the Union Finance Minister, Mr. Yashwant Sinha. Mr. Sinha said there was a great merit in the concept and felt that the issue must be approached proactively by all Asian countries.

Mr. Sinha said Singapore should take the initiative and suggested that the Finance Ministers of the two countries form the task force.

Also the exercise of forming the free trade zone should carried out by the private sectors of the two countries, with the Governments playing facilitator.

Mr. Sinha also apprised Mr. Goh of the Indian Government's commitment to go ahead with the economic liberalisation programme and listed some of the recent measures adopted after the BJP-led Government was re-elected.

The Minister also said information technology, bio-technology and pharmaceuticals were emerging as areas of strength in the Indian economy, but that traditional sectors such as textiles, steel and cement would continue to be priority areas.

In this context, he called for more inflow of foreign direct investment, especially in view of the investor-friendly climate created by the Indian Government.

Appreciating the on-going economic reforms, Mr. Goh suggested that their pace be increased so that India was not submerged by the strong Western economies.

At a separate function, the Minister for Information Technology, Mr. Pramod Mahajan, told the business delegation accompanying Mr. Goh that the two countries had decided to form a task force to identify areas of convergence and cooperation in the IT sector.

It would identify core and emerging areas in the sector to promote joint ventures.

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