China says ready to resolve toy row with India

By Rajesh Kumar Singh and Manoj Kumar

NEW DELHI (Reuters) - China said on Thursday it was ready to resolve trade disputes with India, including a ban on imports of Chinese toys, a day after Beijing raised the issue with the World Trade Organisation.

Indian Trade Secretary G.K. Pillai and Chinese Vice-Minister of Commerce Zhong Shan held talks in New Delhi to try and remove irritants that were holding back trade between the world's two most populous nations.

"The Chinese government was concerned about the imposition of restrictions on Chinese toy exports to India and that is one issue that I had my discussions with Secretary Pillai today," Chinese Vice-Minister of Commerce Zhong Shan said.

"Between our two countries we do have the ability and agreement to resolve it ourselves."

In February, India imposed a six month ban on import of Chinese toys on health safety grounds but relaxed the ban last month. India now allows such imports if they are certified by global safety agencies.

The row has been closely watched as an example of trade tensions between developing countries at a time when fears are growing that protectionist measures could make the economic crisis worse.

On Wednesday, China used a meeting of the WTO's technical barriers to trade committee to raise the issue of import restriction on Chinese toys by India.

Pillai said India was concerned over the denial of market access for Indian pharmaceutical and farm products including basmati rice in China.

He said it was important for both the nations to boost trade at a time of global slump, and shun protectionist policies.

India's export to China stood at $10.8 billion and imports were at $27.1 billion during 2007/08 according to official figures.