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Editorial: Economic cooperation agreements shouldn't neglect cultural ties

Published by The Straits Times, Singapore on 2004-11-16

SINGAPORE and India are expected to sign a historic Comprehensive Economic Cooperation Agreement within the next two weeks, a pact that each country hopes will be in its self-interest and also in the interest of eventually establishing a larger integrated South-east regional market with virtually no tariffs or trade barriers. That the agreement, known by its acronym Ceca, was stitched together barely two years after both countries decided that it would be a good thing, is testimony to the growing political good will between Singapore and India - and to the fact that each country needs the other in our interdependent world of globalisation. India covets Singapore's spare cash at a time when foreign direct investment is slackening. Mr Kamal Nath, the Indian Minister of Commerce and Industry - the prime architect of Ceca - says he expects that Singaporeans will pour more than US$2 billion into developing India's languishing infrastructure next year. With an aggregate investment of US$1.3 billion in Indian technology and telecommunications industries, Singapore is already Asia's biggest investor in the burgeoning Indian economy which, at nearly US$675 billion, is almost six times that of Singapore. The latter, in turn, wants to attract top-notch Indian professionals, particularly in financial services and technology. While Ceca covers some 12,000 articles of trade, what distinguishes it from being just another trade agreement is that it encompasses questions of investment and services. Both countries have promised strong regulatory measures that would protect each other's investments, and also guarantee Indian professionals more access to jobs in Singapore. Air routes are likely to be further opened up, and also access for Singaporean investors in aviation and Indian manufacturing.

All that is to be cheered. But there is worrisome rumbling underneath Ceca, and it has to do with cultural and political perceptions. The Indians privately believe that Singaporeans have been high-handed and arrogant during phases of the negotiations. Some top Indian officials are troubled by what they perceive to be "cultural dimensions" of Singaporean culture - code for racism of Chinese toward darker Indians; the experience of some Indian government delegates in Singapore has been marked by unpleasant incidents. Similarly, some Singaporeans have suggested that Indians and their products aren't entirely to be trusted - that Indians are all too willing to take shortcuts. Such concerns should not be shrugged off, for trade agreements aren't worth the paper they're printed on if cultural relationships and personal associations aren't nurtured. The perception that Singaporeans tend to show superiority in their dealings with non-Singaporeans isn't a new one; but the fact that it has come up, however subtly, in the country's dealings with the world's biggest democracy, doesn't necessarily augur well for Ceca. In the final analysis, investors and professionals on both sides will make overtures toward each other only if they feel genuinely welcome and genuinely appreciated. In that sense, Ceca is only a milestone; the more long-term question of strengthening Singapore-India cultural relations has yet to be addressed with candour.

Pranay Gupte,
Senior Writer and Global-Affairs Columnist

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