international calls in several countries, with the call from the United States to the country in question serving as the benchmark (since the United States is one of the most competitive markets). In the case of India, the benchmark is itself inflated because providers based in the United States are obliged to pay the Indian monopolist the settlement rate for terminating their calls, and this inflates their price. Nevertheless, we find that the price of calling from India is nearly _twice_ this overstated internationally competitive price. This is significantly higher in absolute and relative terms than the price from locations such as Hong Kong and Australia where competition has been introduced, and from Singapore where call-back services have been permitted to eat away at monopolistic price margins.

Chart 4 compares the transport and insurance costs for Indian exports to the US with those for Singapore and other countries. The United States is one of the few countries which collects statistics on its imports on both a fob and cif basis. The difference provides a rough measure of _ad valorem_ transport and insurance costs. Estimates of _ad valorem_ nominal tariffs are also presented. Insofar as India exports lower value products than Singapore the ad valorem transport cost estimates for India are likely to be biased upward. Nevertheless, it is particularly striking that even though India faces lower applied tariffs than Singapore in sectors of major export interest like apparel articles and accessories, iron and steel articles, and electric machinery, its higher transport and insurance costs more than offset this advantage so that the total incidence of transport costs and tariffs is greater. The picture looks more worrying when India is compared with all other countries (which is a less efficient benchmark than Singapore). Transport and insurance costs are nearly twice as high than for all countries.

# Securing market access: Natural persons

There is no doubt that the Uruguay Round outcome in services was unbalanced. The much-touted trade-off between modes of delivery simply did not take place. Although antipathy to commitments on labor mobility in partner countries was a major contributing factor, an unwillingness on the part of India to open up domestic services markets made its demands for labor mobility difficult to sustain. With India opening up its markets, that bargaining dynamic can change and the prospects for serious inter-modal trade-offs - obtaining labor movement in return for allowing greater commercial presence for foreign service providers - must be greater now. Also, the fact of severe shortages of skilled labor in the US and the powerful constituency of high-technology companies lobbying for relaxation of visa limits makes this a propitious time to put labor mobility squarely on the negotiating agenda.<sup>2 3</sup> That India has a strong comparative advantage in some of the high-skilled 22 See Chadha (1999) for a general equilibrium analysis of the benefits to India of liberalizing services trade.

> 23 The notions of the US as the unrivaled centre of technology and the role of technological progress in motoring the recent US economic expansion resonate deeply with the US public. They would therefore be loath to countenance any obstacles to this march of progress even if it involves greater imports of laborrelated services.

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