Indian exports have fallen from 20 per cent three years ago to almost nil last year. The country is avoiding a competitive devaluation of the rupee. Thus the export growth largely depends on the growth in the world trade. When is that going to happen?

Most people expect that there will be a revival in world trade but the question is how big a revival will it be? And this is very difficult to answer. For example, the Asian economies that were hit hardest are beginning to recover or at least have slowed down the decline. The United States isstill going strong and Europe is advancing not dramatically but steadily. In this situation there is a reason to expect a modest growth rate in world trade.

As evident in the latest Exim policy, India is making strong efforts to meet its World Trade Organisation (WTO) commitments to remove quantitative restrictions on imports. What problem does the EU have with imports from India and how do you justify them?

I welcome the latest import policy and it is a step in the right direction. That of course does not mean that there are no issues that we disagree with. But I have not come here to discuss a particular trade dispute, but to put forward an important proposal of the new round of trade talks.

On the issue of free and fair trade practices, the focus is on free trade. Little is being done to implement fair trade practices. Please comment.

As regards the problem of implementation, I think that the first thing is to monitor the implementation. Secondly, if it is established that somecountry is not implementing its obligation, I would encourage affected countries to go to the WTO's dispute settlement body.

Opening up the service sector will be one of the issues for the next round of WTO talks. Why does it not include the labour services where developing countries like India have competitive advantage?

We have no objection if it is put on the agenda. I believe in an open agenda. As far as I am concerned India and other countries can put whatever they like on the agenda as long as we also put what we like. I am not trying to stop anyone.

How do you expect EU to be a strong economic power when it is dependent on the US for managing political and security issues in the region? For instance, the present EU involvement in the Balkan war has affected the newly launched Euro.

I do not agree with this premise. I do not think that the strong military position of the US has weakened the European economy. The value of the euro went down significantly long before the warstarted. Euro has been launched successfully and the value of euro is an another question. In fact, the Europeans are quite happy that its value has come down as it makes exports competitive.

EU is becoming more united and economically stronger. We have not yet matched that politically, but I think we are beginning to build up a political power base as well, though not a military one. Europe is also talking about having greater movements in defence. This is in an embryonic stage and there is no doubt that economic unity and economic strength has come before political strength. But I think the rest of the world will be making a big and dangerous mistake if it thinks that because one has come before the other, we do not have economic strength.

Commodity prices in the international markets are at a 25-year low. What are the prospect for a country like India whose traditional export base has been commodities?

India is diversifying its exports and correctly so. It is increasing its export base toproducts which have a higher added value.

What problems has the Asian crisis caused for a free and fair international trading system?

I think it has not happened because we have been very careful to stop it. In contest of Asean, we entered into a trade pledge which said that we recognise that as soon as these countries devalue their currencies there is going to be an increase in export promotion with Europe and we accept those as part of the commitment to solve the problem. We will therefore not close our doors to your exports as long as you do not put up trade barriers and carry on the reform process.

How do you expect India to support EU in stopping America from imposing unilateral protectionist measures when Indian exporters also consider EU's anti-dumping and anti-subsidy duty as protectionist measure?

I do not think there is a parallel. India has right to take the issue of anti-dumping to WTO and unilateral measures are the ones which are against the rule. I am definitely againstthe use of anti-dumping to protect any industry. And if European industrialists come and ask to impose anti-dumping because they find the competition tough, I will show them the door. There has to be evidence before any action can be taken. If some one wants the anti-dumping rules to be changed, it should be brought to the table.

Which is the specific trade issue you consider the greatest priority? Do you have a specific priority in EU-India trade?

It is difficult to single out any one aspect. However, the challenge for the international trade organisations is how to accommodate globalisation and how to allow trade to expand. And at the same time ensure that the developing countries are treated well.

China joining WTO is presumably a good move but do you foresee some areas of dispute?

Membership of WTO is not an inoculation against conflict. It provides a challenge that a conflict can be resolved. One of the many attractions of China joining the WTO is that it will have its rightsensured and the rest of the world can take action against it if it breaks the rules, just as the case is with any other country.