The Economic Cooperation Framework Agreement (ECFA), the most ambitious pact ever between the two sides, will come into fruition following approval by Taiwan's parliament last month, the Straits Exchange Foundation said.

Taiwan's Beijing-friendly government has said ECFA, which was signed in late June, will bring higher growth and more employment to the export-dependent island.

The island's opposition, which favours formal independence from China, has argued that ECFA will make Taiwan more reliant on the mainland, while it will have no obvious economic benefits.

Signing the pact has been a major priority for Taiwan President Ma Ying-jeou's administration, which came to power in 2008 on a promise to improve the island's economy through better ties with China.

The Straits Exchange Foundation and its Chinese counterpart, the Association for Relations Across the Taiwan Straits, are semi-official agencies, reflecting the absence of formal ties.

China considers Taiwan part of its territory and has vowed to get it back, by force if necessary, even though the island has ruled itself since the end of a civil war in 1949.

earlier related report
India says US protectionism is regressive
Bangalore (AFP) Sept 11, 2010 - India's trade minister lashed out at perceived protectionist moves by the US on Saturday, calling them "regressive" and saying they could delay economic recovery.

The statement by Trade Minister Anand Sharma came after the state of Ohio banned outsourcing back-office jobs to places such as India in an effort to boost domestic employment.

It also follows a recent US law raising visa fees for skilled workers, that will India says will hit its flagship outsourcing sector.

"We feel these are regressive measures," Sharma told reporters as he visited India's second-largest software exporter by sales, Infosys Technologies, in the southern city of Bangalore.

"The leading economy of the world -- the United State of America -- has to have more confidence to engage with the rest of the world," Sharma said in televised remarks.

Ohio state has banned sending abroad government information technology and back-office projects.

India said earlier in the week it would formally raise its concern over Ohio's ban on offshore outsourcing with the United States at a high-level trade meeting in Washington later this month.

New Delhi will also raise the issue of increased fees for skilled worker visas that will boost annual US visa costs for the outsourcing sector by 200-250 million dollars annually, according to industry estimates.

"Protectionist tendencies are unhealthy and negative, and lessons from the past make it abundantly clear they end up deepening the recession, they do not help in recovery of economies," Sharma said.

"Any mindset, which is isolationist and inward-looking ends up hurting the economies and societies," he said.

The US measures have come as the country seeks to combat unemployment, which is nearing 10 percent.

The row comes ahead of US President Barack Obama's visit to India in November.

earlier related report
US envoy seeks to play down India outsourcing row
New Delhi (AFP) Sept 10, 2010 - The US ambassador to India sought on Friday to downplay a ban on outsourcing by the state of Ohio, saying it would have no effect on relations between Washington and New Delhi.

Timothy Roemer said the partnership between the world's two largest democracies was now "indispensable" after improving greatly in recent years.

Ohio state has banned outsourcing of government information technology and back-office projects to locations such as India as it seeks to combat unemployment, which is nearing 10 percent across the United States.

Speaking to reporters in New Delhi, Roemer brushed off Ohio's action, saying relations between India and the United States had reached a new plane.

"We are talking about global cooperation between the United States and India on terrorism, counter-terrorism, on economics and commerce, on job creation in both places, on green partnership and the next green revolution," he said.

"India has moved from 21st largest trading partner to the 14th largest trading partner (of the US) over the last five or six years. That is the real progress in this relationship," Roemer said.

The US envoy's comments came after India said Thursday it would formally raise its concern over Ohio's ban on offshore outsourcing with the United States at a high-level trade meeting in Washington later this month.

Indian officials have said, however, that they wanted to avoid confrontation ahead of US President Barack Obama's visit to the country in November.

More than half of the world's top 500 companies outsource work to India, which has become the world's back office, where Western firms have set up call centres and number-crunching and software development outlets to cut costs.

But the 50-billion-dollar industry also flies employees each year to the United States to work at their clients' locations as on-site technicians and engineers.

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