NEWS RELEASES

June 6, 2001 (4:10 p.m. EDT) No. 77

PETTIGREW ANNOUNCES TRADE MISSION TO INDIA

On the occasion of a visit to Canada by Indian Minister of Power Suresh Prabhu, International Trade Minister Pierre Pettigrew today announced that he will lead a trade mission to India in the fall to further explore and develop some of the many opportunities for Canadian enterprises in several important sectors, including energy.

"There are many excellent opportunities for Canadian companies in India, including energy, which is one of the most promising sectors for Canadian exporters," Mr. Pettigrew said. "We want Canadian companies to take a serious look at the significant trade and investment opportunities in India so that we can realize our full trade potential."

The Indian government is encouraging private participation in all aspects of power generation, transmission and distribution. Opportunities exist for Canadian companies in areas ranging from power generation to modernization of old power plants. Minister Pettigrew today also welcomed the signing of a $115 million line of credit between Export Development Corporation and India's Power Finance Corporation Limited to finance the supply of goods and services by Canadian exporters. The new financing will benefit Canadian companies selling goods and services to the power industry in India.

Minister Prabhu, here today through June 10, is the first Indian Minister to visit our country since the government announced last March that Canada intends to pursue the broadest possible political and economic relationship with India. He met with Mr. Pettigrew today, and with Dr. Rey Pagtakhan, Secretary of State (Asia-Pacific).

"Broadening our relationship with India -- one of the largest markets in the world -- promises to be quite beneficial for Canadian businesses," Dr. Pagtakhan said. "The Indian market holds tremendous opportunity for Canadians, and the Government of Canada is actively promoting our increasing trade presence in India through a series of seminars across Canada."

Mr. Prabhu will continue on to Quebec for a visit to the James Bay hydro-electric power project -- one of the largest dams in the world -- and to meet with private-sector representatives. He will then head to Toronto for several events, including speaking to private- and public-sector energy representatives on power opportunities in India.

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A backgrounder is attached.

For further information, media representatives may contact:

Sébastien Théberge

Office of the Minister for International Trade

(613) 992-7332

Stephanie Ashton

Office of the Secretary of State (Asia-Pacific)

(613) 995-2742

Media Relations Office

Department of Foreign Affairs and International Trade

(613) 995-1874

Backgrounder

Canada's merchandise exports increased 18.3 percent to $538 million in 2000. Commercial services exports were $93 million in 1998 statistics (the most recent data available).

Canada's imports from India have increased steadily throughout the past decade. Canada's merchandise imports from India were $1.23 billion in 2000, a 20.9 percent increase over 1999. Imports of commercial services were $41 million in 1998.

Canadian companies are active in India in traditional sectors such as power, communications and transportation. Opportunities are also presenting themselves in new sectors such as information technology, the environment and agri-food.

The Indian economy has changed considerably since 1991, when India launched its program of economic reforms and trade and investment liberalization. The Indian government has been steadily lowering tariff rates, from a peak rate of 300 percent in 1991 to a current maximum rate of 40 percent.

India has relatively low inflation (five percent annually), a stable currency, and a current account deficit of less than two percent of its gross national product (GNP). It's banking system is solid, and the country has foreign exchange reserves of about $49 billion. The amount of foreign direct investment is not large in relation to the size of India's economy.

Over the past decade, India has consistently ranked among the world's top 10 economies based on annual growth. In absolute size, measured in US$GNP, it jumped from 16th to 11th position during the last five years.