Israel may soon sign free trade agreement with India

Discussion in 'West Asia & Africa' started by Oracle, May 26, 2010.

  1. Oracle

    Oracle New Member

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    Wed, May 26 12:45 PM
    Jaipur, May 26 (ANI): Israel's Ambassador to India Mark Sofer, has said in Jaipur that India and Israel would soon be signing a free trade agreement.

    Sofer was interacting with media on Tuesday in Jaipur.

    He also mentioned that preliminary negotiations would commence on Wednesday and a team of experts from Tel Aviv would be reaching New Delhi.

    "The Indian Government has decided to go ahead with the free trade agreement. So, we are bringing over our experts, actually they arrive today and the talks will start, I think, tomorrow. So, we are very excited about that," Sofer said.

    He further noted that this landmark agreement would give a major boost to both economies.

    "I reckon that the negotiations will take a bit of time. These are very tough negotiations, they affect industry, they affect agriculture, they affect technologies, they affect transfers of know-how. It's not easy," he added.

    Sofer said that after the free trade agreement is signed, civilian trade between the two countries would reach around 12 billion dollars, triple the present figure of four billion dollars.

    Israel is extending help to India for better utilization of water and two Israeli companies are going to operate in Rajasthan.

    Israel would also set up its research and development centres in Rajasthan to use saline water for agriculture. (ANI)

    http://in.news.yahoo.com/139/20100526/808/tnl-israel-may-soon-sign-free-trade-agre.html
     
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  3. Oracle

    Oracle New Member

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    India right now is certainly going in the right direction. Well done.
     
  4. SHASH2K2

    SHASH2K2 New Member

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    Its a good step in right direction. our nations has lots of potentials in future and it will help is unlocking them.
    =xy
     
  5. LETHALFORCE

    LETHALFORCE Moderator Moderator

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    This is a good move by both countries it will expand Indian-Israeli relations beyond the military arena.
     
  6. tarunraju

    tarunraju Moderator Moderator

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    Countries like Iran and Israel are good to have as strategic allies, but not quite trade allies of this kind. Israel is avoided by developing economies when it comes to trade agreements of this kind, because Israel is full of resource-devoid entrepreneurs who will exploit India for manufacturing here. A free-trade agreement reduces our revenue department's cut in goods that ship out of here, which are made by Israeli companies. What is India inc. going to sell Israel other than maybe consumer durables such as jams and sauces? Our Tata Indica is barely going to dent American and European car makers who sell there. On the other hand Israel will have high-end manufacturing done here, shipped out, and will end up paying lesser than usual applicable taxes.
     
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  7. LETHALFORCE

    LETHALFORCE Moderator Moderator

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    Israel has a good semiconductor and Biotech industry,it could open an avenue for Israeli investment and joint collaboration.
     
  8. Oracle

    Oracle New Member

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    /\/\/\ "I reckon that the negotiations will take a bit of time. These are very tough negotiations, they affect industry, they affect agriculture, they affect technologies, they affect transfers of know-how. It's not easy," he added.

    Technological co operation and transfer too, Tarun. Wonder how much value it would be if Mossad helps RA&W with the latest technologies that they use, we can stop and kill our enemies on their land.
     
  9. SATISH

    SATISH DFI Technocrat Stars and Ambassadors

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    Israelis have a great technological leaps in Agriculture and farming models. They can be of great use in our country with very low per hectare yeild in many parts of our country. The semiconductor industry is one of the best in Israel and with the R&D moving in here Israeli companies will also have a Manufacturing plant here providing job opportunities to nearly many of the skilled labourers. We would be making the Israelis happer and making us happy.
     
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  10. Oracle

    Oracle New Member

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    Do not forget Drone Technology is Israeli Technology.
     
  11. tarunraju

    tarunraju Moderator Moderator

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    I don't deny that Israel is a good strategic partner. With or without this FTA, our companies can transfer technologies. It's just that FTA benefits Israel way more than it would, to us. Our revenue department needs all the money it can get its hands on.
     
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  12. thakur_ritesh

    thakur_ritesh Administrator Administrator

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    We should differentiate between economic and strategic ties, and one needs to understand a FTA does not mean someone is going to set up a manufacturing or a r&d unit in India, the process of which is completely different to an FTA for which we already have an existing incentive structure in various forms, for which Israel is already coordinating with the Gujarat government to set up their manufacturing units.

    FTA in simple terms means a two way trade between two countries and the enlisted products over a period of time period will attract zero duties.

    Yes what one will get is access to high tech products at much cheaper rates for there will be drop in various duties that otherwise get imposed, but the thing I see happening here is something that has been going on but has largely been kept in the dark.

    Israel exports its products to India, which when land here get taxed, then they get tagged as “Made in India” and are then re-exported from India to middle east and other such countries to which Israel is not able to directly export. Now with the FTA, they will export their products to India which at the time of landing will attract zero tax which means loss to state exchequer which has a direct bearing on our annual budget, and the same process of re-export will continue but what this will mean is that their product will be sold in the international market at a much cheaper rate and in the bargain the little revenues we used to earn from them will become completely zero.

    Atleast from the economics point of view this is no win-win scenario for India, but a certain win for Israel. Now in the bargain are we getting access to something really extraordinary which might be kept under the carpets, then it is good but if that is not happening then well its nothing more than a sell out.

    I would be very interested to know the trade balance once this FTA is put into place, and if it were to heavily scale in favor of Israel then something is really amiss.
     
    Last edited: May 26, 2010
  13. tarunraju

    tarunraju Moderator Moderator

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    That is exactly my point. Trade-balance will not make this deal viable for the Indian economy. Only to the politicians, who will receive kickbacks from Israeli companies to set up manufacturing here, or dictate the terms of their operations here.

    Israel has nothing new to offer, not even technologically. India has already taken big strides with biotechnology, and the highly-developed pharmaceutical industry here is propelling biotech technology transfers, as well as funding. As for semiconductor, SemIndia is already working in the direction of building semiconductor fabs in India, with IP owned by Indian firms. This is a much more beneficial model than in China, where IP is owned by foreign firms, and fabs located there merely pay their bills, provide jobs, and pay taxes. Taxes and duties is exactly where there will be loads of exemptions for Israeli firms with this FTA, and hence this will not be beneficial to the Indian economy by any large measure. In turn it will be a burden for our natural resources. Jobs to local labour is peanuts.

    Always avoid a resource-starved country full of entrepreneurs.
     
  14. thakur_ritesh

    thakur_ritesh Administrator Administrator

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    Tarun,

    Yes mate, agree with you, and seriously our present commerce minister has come as a big disappointment right from the talk of 74-100% fdi in the defence sector to an fta with Israel which really does not add up, to tharoor who was openly advocating and lobbying for the Americans (sorry cant recall the exact stuff he was trying to push around but was related to Americans and trade) to our environment minister pushing a chinese company without understanding the background of rejection to well the king of all our telecom minister.

    There are some people who are seriously going to get super rich dudes by the end of UPA II, not an issue with that as well but only if all that money was to be kept in the Indian banking system which wont be happening and then we will be sold the illusive dream of getting all the black money at the time of elections which is kept safely is overseas banks.
     
  15. ndrshh

    ndrshh New Member

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    I don't completely agree that a Free Trade Agreement with Israel would be entirely unilateral. Sourcing goods to another destination through a country is not the only thing that such an agreement calls for. Importing Israeli goods at zero excise duty would also mean greater choice for the Indian consumer in buying products. Of course, in sectors where there is a clash between Israeli goods and Indian goods, one has to balance the argument between encouraging free trade and promoting local businesses. However, Indian entrepreneurial skills are more than matched in an event where the markets are flooded with foreign goods, and in any case, isn't the average Indian consumer always hankering after foreign goods as opposed to 'desi' varieties? Free trade would be the vehicle not only for greater diplomacy but also for greater defence ties with Israel which would mean procuring technologies and equipment which the Americans always throw at the Israelis. Also, I don't think anyone could deride the El Dorado of information that India would gain if the Research and Analysis Wing tied up with MOSSAD. There's a joint operation that would really sink its teeth into terrorism across the Middle East and right into the Afghanistan/Pakistan region that annoys India so much. Granted these are seperate issues which an FTA does not deal with but the wheels of diplomacy are always greased with gold and that is where the FTA comes in very handy. Kudos to the current administration for pursuing this in India's best interests.
     
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