Thank you, Mr. Chairman.
Distinguished members of the committee and ladies and gentlemen, thank you for this opportunity to share my views on the trade negotiations with India.
Let me give you some background on Prudential Consulting and its group of companies. Prudential Consulting is an early pioneer in advising large and small clients who wish to make investments in India and engage with Indian public and private companies to export their products and services. In the past 17 years, PCI has advised a number of small and large businesses wishing to enter the Indian market and/or that are interested in procuring from India and/or importing skilled human resources for projects in Canada.
On the trade negotiations, firstly, we can draw a number of parallels between these negotiations and the Indian trade negotiations with Australia and the United States. For the purpose of size and context, I will focus on some of the common factors between Canada's negotiations with India and the Australian negotiations with India.
Firstly, the Australians see the same opportunity that we do in a significant and young population: purchasing parity, affluence, growing demand, and a very large middle class that is growing at a very rapid pace. Similar to Canada, Australia has identified the same or similar priority sectors—ICT, energy, mining and infrastructure, food processing and agribusiness, and education services—as the low-hanging fruit on where best to engage. Engagement between the organizations similar to those in the Canadian realm—civil society groups, business associations, public and private agencies—are pushing policy-makers on both sides to create a trade framework.
In the Canadian context, it's my view, based on the surveys I've read, including the national opinion poll conducted by the Asia Pacific Foundation of Canada, which I would recommend to everyone, that more Canadians than ever before are in tune with Asia and attribute their longer-term prosperity to increased trade links with Asia. However, the warm feelings toward Asia remain well below those for western democracies, with Australia and Japan being the exceptions.
The point I'm making is that policy-makers will have to be cognizant that only four out of ten Canadians are supportive of free trade agreements with Asian countries such as India, because two-thirds of Canadians oppose the idea. This gap between what policy-makers may seek to do with free trade agreements and the engagement of Canadians needs to be bridged through better communication and education.
I would like to talk about the export readiness of Canadian companies. Even amongst seasoned Canadian exporters that are used to exporting to the U.S. and Latin America, there's a great disparity in the knowledge and experience in exporting to India. This disparity has further resonance from province to province. As policy-makers, it'll be important to use tools at our disposal to bridge these gaps and make our companies export ready.
I would like to take the specific example of Atlantic Canada and the Atlantic Canada Opportunities Agency. This federal agency can play a very important role in ensuring that Atlantic Canadian companies and organizations reach their full potential in exporting to India. Further, in evaluating opportunities, our collective assets such as the BDC, the Export Development Corporation, the Canadian Commercial Corporation, and the Trade Commissioner Service must learn to function as a unit wherever possible.
In talking briefly about the procurement policy of both governments, which will be a topic of trade negotiations in allowing access to government-related business, I urge policy-makers to look beyond the negative connotations associated with offshoring and foreign ownership to opportunities in sensitive and non-traditional areas such as defence and aerospace. Beyond bullets and bombs, Canada has a number of defence technologies that have great potential in the $80-billion defence market in India. Further, as Canada builds its own defence infrastructure—such as naval vessels—Indian investment and manufacturing prowess can have a positive impact in places such as Halifax and Vancouver, amongst others.
Moving on to the topic of negotiations, Indians themselves have to deal with a lot of red tape, archaic and obstructive administrative and bureaucratic policies, and, lastly, corruption. It would be naive for Canada to think that in doing business with India our values somehow will be readily adopted. As we proceed through negotiations and make the first engagements, Canadians will have to be patient and mentally ready to take on those challenges lest they be demoralized due to short-term challenges.
In summary, if two-way trade between Australia and India can grow from $3.3 billion in 2000 to over $20 billion in 2011, there's great potential for Canada to grow its trade manyfold by: addressing tariff barriers and behind-the-border restrictions on trade in goods; entering into a free trade agreement that could facilitate growth in services trade; and increasing regulatory transparency and facilitating and encouraging investment by reducing barriers faced by Canadian suppliers and enhancing investment protections.
Thank you.