New Zealand Requests Consultations With India To Resolve Trade Dispute

Trade Minister Lockwood Smith announced today that New Zealand has sought consultations with India under the dispute settlement provisions of the World Trade Organisation (WTO).

Dr Smith said that similar action was being taken by the United States, Australia and other WTO Members.

India's trading partners are asking India to remove import restrictions on a large range of products. These include agricultural and manufactured goods of interest to New Zealand exporters.

The restrictions were originally justified because of India's Balance of Payments difficulties. "The International Monetary Fund (IMF) had confirmed, however, that these difficulties were now over and that India should remove its longstanding import restrictions," Dr Smith said.

The Minister said New Zealand regretted that India has been unable to present a satisfactory plan to phase-out the restrictions.

"For many New Zealand exports, we were going to have to wait another seven years before the Indian market opened up. That was too long."

"I have raised this issue with visiting Indian ministers. The import restrictions continue to be a real obstacle to the development of our trade relations with India, and are widely viewed as inhibiting India's economic growth."

Dr Smith said that in these circumstances, the consultations were being requested with a view to resolving the impasse.

The consultations will be held in Geneva over the next two months. If an acceptable solution is not developed within this period, concerned WTO Members may request the establishment of a three-person dispute settlement panel to adjudicate on the dispute.