Xo
PRIORITY CYPHER/CAT A
RESTRICT:ED
(MC.13/302/2)
FM F C O 261240Z.
RESTRICTED.
NEUTRAL.
TO PRIORITY GOVERNOR FALKLAND ISLANDS TELEGRAM NO. 132 OF 26 MAY, AND TO GOVERNOR GIBRALTAR, ST HELENA, SEYCHELLES, HIGH COMMISSIONER WESTERN PACIFIC, CASTRIES, WELLINGTON (FOR GOVERNOR PITCAIRN), INFO RESIDENT COMMISSIONER GILBERT AND ELLICE ISLANDS, ANTIGUA, ST VINCENT.
ANGLO/INDIAN TRADE AGREEMENT OF 1939.
1. AS HAS ALREADY BEEN ANNOUNCED, WITH EFFECT FROM 1 JANUARY 1972 THE PRESENT PROTECTION OF THE BRITISH COTTON TEXTILE INDUSTRY BY QUOTA CONTROL WILL BE REPLACED BY A TARIFF ON IMPORTS FROM THE COMMONWEALTH PREFERENCE AREA. THE NEW ARRANGEMENT IS AN ESSENTIAL PART OF THE DEVELOPING POLICY DESIGNED TO HELP OUR INDUSTRY SURVIVE AN COMPETE IN AN INTERNATIONAL ENVIRONMENT. IT SHOULD REDUCE EXPORTS FROM THE DEVELOPED COUNTRIES WHICH HAVE BENEFITED FROM QUOTAS. DEVELOPING COUNTRIES, WITH THE POSSIBLE EXCEPTION OF INDIA, ARE LIKELY TO BE ABLE TO EXPORT AS MUCH AS BEFORE TO BRITAIN.
2. THE PROPOSED TARIFF IS IN CONFLICT WITH THE ABOVE-MENTIONED AGREEMENT. IN DECEMBER 1970 WE ASKED THE INDIAN GOVERNMENT TO GRANT US A WAIVER. FROM OUR OBLIGATIONS TO ENABLE US TO IMPLEMENT THIS POLICY. THE INDIANS HAVE STILL NOT AGREED TO DO THIS. IF THEY DO NOT DO SO BRITAIN WILL BE FACED WITH NEED TO TERMINATE THE AGREEMENT. THIS AGREEMENT (COPY FOLLOWS BY BAG) IMPOSES OBLIGATIONS ON THE UNITED KINGDOM AND ON INDIA AS REGARDS THE TERRITORY FOR WHICH YOU ARE RESPONSIBLE. UNDER ARTICLE 8 YOUR TERRITORY IS OBLIGED TO ACCORD INDIA ANY PREFERENCES WHICH MAY FOR THE TIME BEING BE ACCORDED TO ''ANY OTHER PART OF THE BRITISH EMPIRE''. UNDER ARTICLE 11 INDIA UNDERTAKES TO ACCORD TO YOUR TERRITORIES GOODS PREFERENCES, IN SOME CASES 10 PERCENT ON SPECIFIED CCCDS, AND UNDER ARTICLE 12 TO GIVE TREATMENT TO ANY GOODS NOT LESS FAVOURABLE THAN ON THOSE OF ANY FOREIGN COUNTRY. IT IS NOT KNOWN HERE WHETHER THE PROVISIONS OF THE AGREEMENT ARE IN FACT BEING APPLIED TO YOUR TERRITORY OR HAVE ANY SIGNIFICANCE ON YOUR TRADE WITH INDIA.
RESTRICTED
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