New FTA with Asean ready
India has concluded discussions on a free trade agreement (FTA) in services and investments with the 10-member Association of Southeast Asian Nations (Asean) and a formal announcement is to be made on Thursday.
Anand Sharma, minister for commerce and industry, said: “We had in August 2009 signed an FTA (on goods) between India and Asean. The year-on-year growth in trade has been in excess of 30 per cent. Two-way trade now stands at $80 billion, while two-way investments are close to $73 bn. We recognise these are well below potential...we have taken forward negotiations on an agreement on investment and services, so that we can make it a comprehensive economic partnership. Now we will definitely conclude it."
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Cham Prasidh, Cambodia's senior minister and minister of commerce, said the agreement will increase economic engagement in the region and help India and Asean to increase two-way trade to $100 bn by 2015 from the current $80 bn.
Gita Wirjawan, his Indonesian counterpart, said, “"It (the new agreement on services and investments) will be a game-changer for the nature of economic relations between the two zones." But though the agreement is expected to be announced formally this week, implementation could take up to a year, he added.
Asean comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.
The latest FTA’s finalisation would pave the way for talks on a Regional Comprehensive Economic Partnership (RCEP), bringing together a market of more than half of the world's population and nearly a third of its gross domestic product, India and Asean had said in August. Sixteen countries—the 10 in Asean, Australia, China, Japan, India, New Zealand and South Korea -- are part of the talks on a greater flow of goods and services under the RCEP. Prasidh said he expected negotiations for the RCEP to conclude by 2015.
Thai pact soon
Besides, the free trade pact with ASEAN, India is negotiating market opening pacts bilaterally with members of the bloc. An FTA has already been implemented with Singapore and Malaysia and one is being negotiated with Indonesia. Srirat Rastapana, director-general of the Thai government’s department of international trade promotion, said the ongoing talks between India and Thailand for such a pact might conclude next month. "We are at the last leg of negotiations. (The) FTA will help to drive the economic relationship," he said.
Trade ministers of all 10 Asean nations were present today at the Indo-Asean Business Fair (IABF), being held here between today and Thursday. This second edition of the IABF has been organised by the Federation of Indian Chambers of Commerce and Industry and the ministry of commerce, on the occasion of the 20th year of talks between India and Asean and 10 years of summit-level talks between the two zones. Prime Minister Manmohan Singh and trade ministers from all 10 Asean countries are to attend the commemorative summit tomorrow.