By Gurmukh Singh, IANS,
Toronto : India’s route to boost its trade with the US lies through Canada, says a report here.
With a free US-India trade accord nowhere in sight, New Delhi should ink a Comprehensive Economic Partnership Agreement (CEPA) with Ottawa to get more access to the US market, says the report by the Toronto-based C.D. Howe Institute.
“For India, the strategic priority could be to gain greater access to the US market through Canada, given that a comprehensive US-India bilateral free trade agreement does not seem to be in the cards,” says the report titled ‘Does Canada Have an India Strategy? Why it Should and What Both Sides Can Gain from Comprehensive Talks.’
“A negotiation with Canada could be a second best route to this objective as a strategic signal of India’s potential importance to the North American economies.”
With their bilateral trade picking up after a slew of accords signed in the past two years, India and Canada are negotiating CEPA to take their trade to $15 billion in the next four years.
Canada should “aim high in a deal with India,” says study author Wendy Dobson, who is a professor at University of Toronto’s Rotman School of Management.
“In the past seven years, in particular, India’s economy has displayed increasing dynamism – indeed, measured at current exchange rates, Canada’s and India’s economies are about the same size (11th and 12th largest in the world, respectively), while on a purchasing power parity basis, India jumps to 4th and Canada drops to 14th,” according to the report.
With this treaty inked, Canada can “take advantage of the efficiencies available from Indian information technology services providers, and to gain greater access to both the Indian and wider Asian markets using India as a platform for regional operations.”
While India is Canada’s 15th largest trading partner, Canada ranks 33rd on India’s list.
Currently, Canadian goods face 16 percent tariff in India while Indian goods face nine percent tariff in Canada.
But once the deal is signed and tariffs are eliminated, “each side could realize gains of between $6 billion and $15 billion,” according to the report.
(Gurmukh Singh can be contacted at [email protected])