CONFIDENTIAL
Effect on and regations in Commonwealth contaies
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We may expect all the Commonwealth countries affected
to react adversely to the tariff proposal both on the general
grounds mentioned above and also because of the fear of danego
to their export trade. Reactions are likely to bo
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particularly fierce from Indie who, it is estimated, right
loco by 1975 more than half the value of hor present ozporto
of cotton textiles to this country unless the Indian Covemment
took special action (e.g. by way of subeidios) to prevent
this happening.
8. We have received clear indications that the Canadian
Goverment would also be highly critical since they are
certain that the imposition of a tabiff would very much roducc
Canadian exports to Britain (about £10 million in 1960).
Pressures for comprehensive import controle in Canada would
increase,
9. The Canadians also doubt whether the imposition of a
tariff on Commonwealth textilos would secure the degree of
protection and the reduction of imports which the Textilo
Council's Report suggests. The Canadian argument is that
coste in Canada and Britain are not very different and that
present Canadian tariffe, which are higher than wo would
apply, have been quite inadequate in proventing a groving
flood of importo. Canadian officials fear that, in pressing
for a tarife, the boxtile industry may hope that ito subsequen
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CONVIDEOTAT.