China on Saturday said it is close to implementing a key bilateral trade arrangement with India to accord each other preferential tariffs on a range of products that would further boost booming trade ties.

"The arrangement between China and India on mutual preferential tariffs is expected to be put into practice soon," the official China Daily reported on Saturday.

With the arrangement, China and India, two developing nations, will offer each other special tariff treatment, which is to be more preferential than their Most Favoured Nation (MFN) tariffs, the paper quoted officials from the Chinese Ministry of Commerce as saying.

China will provide a list of reduced tariffs to India based on its 2003 MFN tariffs, with the average tariff rate for goods in the list 13.5-percentage-points lower than its MFN tariffs.

The list will cover 217 items, including food, pharmaceutics and leather, as well as chemicals, textiles and machinery.

Similarly, India will also provide "specifical preferential tariffs" for some products imported from China, the report said.

Just after Prime Minister Atal Bihari Vajpayee's visit to China in late June, the Indian government issued its list.

The Indian side promised to offer specific tariffs, lower than its MFN tariffs, on 188 items from China.

They included aquatic products, paper, steel and other metals, chemical and rubber products, electric equipment and toys.

Courtesy: www.hindustantimes.com, July 26, 2003