Vajpayee seeks gateway to ASEAN during KL visit

Vajpayee seeks gateway to ASEAN during KL visit

KUALA LUMPUR (AFP): Indian Prime Minister Atal Behari Vaypayee
started a four-day visit to Malaysia on Sunday, seeking to build
on centuries-old links to open a trade gateway to Southeast Asia.

Vajpayee arrived on Sunday evening aboard a special Air India
jet, accompanied by a 135-member delegation including 75
businessmen.

Trade deals -- including a proposal to swap Malaysian palmoil
for Indian role in a major railway contract -- will top the
agenda for the trip, an attempt to consolidate India's "Look
East" policy.

"Our history of cultural and commercial linkages has been good
for centuries," Indian High Commissioner (ambassador) Veena Sikri
told AFP.

"Malaysia can be India's gateway to ASEAN (the Association of
Southeast Asian Nations) to increase India's trade in the ASEAN
region.

"It's a win-win situation for both countries... cooperation
between India and Malaysia is a genuine example of South-South
cooperation," Sikri added.

"We are looking ahead to a more active trade and investment
relationship."

India is one of the world's largest information technology
software producers while Malaysia has very good IT infrastructure
and a hardware industry, she said.

Infrastructure deals would also figure prominently, with
Malaysian firms already building roads in India and Indian
companies involved in railways here.

The biggest potential deal is a contract for the double-
tracking and electrification of 300 kilometers (186 miles) of
railway line from the northern city of Ipoh up to the Thai
border.

The total cost is an estimated six to seven billion ringgit
($1.6-1.8 billion).

If Malaysia's proposal is accepted, the five-year project
would be paid for through annual Indian imports of up to 1.6
million tons of palmoil.

Asked on Friday if the deal could be concluded during
Vaypayee's visit, Transport Minister Ling Liong Sik replied: "I
don't foresee any problem."

Malaysia's foreign ministry said agreements or memorandums of
understanding (MOUs) on finance, information technology, services
and the stock exchange were expected to be signed at government
level.

Businessmen were expected to sign deals or MOUs on aerospace
technology, trade promotion and high technology software
applications.

Sikri said agreements on information technology services,
avoidance of double taxation, civil service cooperation, tourism
and scientific research would be signed.

Vajpayee will on Monday call on his Malaysian counterpart
Mahathir Mohamad, attend a high-powered business forum Tuesday
and deliver a lecture Wednesday before leaving that afternoon.

The current trade balance is sharply tilted in Malaysia's
favor, with India exporting goods worth $434 million and
importing products, mainly palmoil, worth two billion dollars in
the Indian fiscal year that ended 2000.

"We plan to diversify the existing trade basket which is
dominated by goods like meat and cotton from our side and palmoil
and electronics from their side," said R.S. Kalha, secretary in
India's foreign ministry, last week.

Malaysia will urge India to cut its high tariffs of around 92
percent on imported palmoil, Primary Industries Minister Lim Keng
Yaik said last week, adding he expected a sympathetic response
from Vajpayee.

Malaysia, the world's largest palmoil producer, exported about
2.4 million tons of palmoil to India last year.