By Paul Eckert
BEIJING (Reuters) - China kept up the momentum in its drive to enter the World Trade Organization on Tuesday, striking a deal with India as crucial negotiations with the European Union entered a second day.
India and China signed a WTO accession deal as EU negotiators, led by European Commission trade official Hans-Friedrich Beseler, met again with a Chinese team headed by Vice Foreign Trade Minister Long Yongtu.
India is only a minor trading partner but was among key emerging economies that needed to complete a bilateral trade accord with China. An Indian official said the deal would help double bilateral trade in the next three years.
The EU imposed a virtual news blackout on its negotiations to remove the biggest remaining obstacle to China's WTO membership.
Officials of the EU -- the most important WTO member yet to conclude a trade deal with China -- have refused all comment on their talks since they opened on Monday.
EU country diplomats in Beijing were warned against talking to reporters -- a reflection of the delicate task of representing the diverse interests of 15 member states, which range from industrial powerhouses to tiny financial centers.
EU officials say that last year's Sino-U.S. trade pact, a breakthrough in China's WTO bid, met 80 percent of EU concerns. But Brussels is keen to show it is not a pushover now that China has a deal with the United States, its biggest trading partner.
European businessmen said they expected a deal soon and suggested the EU needed to show its members it was holding out for a better market-access package even if the gaps between EU and U.S. demands were minimal.
Keen Interest In United States
The EU talks are being watched closely in Washington, which clinched its market-opening pact with China in November.
U.S. officials are keen to see China conclude agreements with the EU and several other countries so they can send the deal to Congress quickly for a vote before an expected surge in anti-China sentiment and looming presidential elections.
U.S. labor unions have launched a major campaign in a presidential year to shoot down China's entry based on what they say is Beijing's poor record on human rights and labor issues.
China gave new ammunition to its U.S. foes on Monday when the State Council, or cabinet, said Beijing would use "drastic measures, including military force" if democratic rival Taiwan dragged its heels indefinitely on reunification talks.
The ultimatum -- an apparent hardening of China's stance toward a wealthy island estranged from the Communist-ruled mainland since the Chinese civil war ended in 1949 -- rattled financial markets in China, Taiwan and Hong Kong.
Third Day Of Talks Possible
EU sources say a third day of negotiations would be arranged if all goes well and EU Trade Commissioner Pascal Lamy has said he is ready to jump on a plane to Beijing this week.
Premier Zhu Rongji told visiting WTO chief Mike Moore last week he hoped a deal would emerge from the Beijing talks.
Zhu and President Jiang Zemin have personal stakes in ensuring China's early membership, having pushed for it in the face of bitter opposition from government conservatives.
The Europeans were expected to press China to top some of the concessions made to the Americans in telecommunications and financial services, according to sources close to the talks.
In particular, the EU wants more licenses for European insurers. China has granted business licenses to just 14 foreign insurers, including five U.S. firms and five European ones, but some U.S. firms hold more than one license.
They also have specific European issues to negotiate, such as access for British gin and Scotch whisky, French cosmetics and cheese and Italian leather goods.
Indian Commerce and Industry Minister Murasoli Maran signed a WTO deal with Chinese Foreign Trade Minister Shi Guangsheng on Tuesday after five years of trade negotiations.
China must reach agreements with all WTO members who request talks before it can join the body that sets rules for global trade.
The United States, Japan, Australia and Canada all reached separate agreements with Beijing last year. Key emerging economies like Argentina, Thailand, Mexico, and Malaysia have still to complete their own accords with China.:
