ID :
17386
Fri, 08/29/2008 - 15:42
Auther :
Shortlink :
http://m.oananews.org//node/17386
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India, Asean conclude deal for FTA in goods By Jaishree Balasubramanian
Singapore, Aug 28 (PTI) India and southeast Asian trading
bloc Asean Thursday successfully concluded six years of
negotiations for a free trade agreement in goods that will
create an European Union-like single market.
A "key regional milestone" is how Commerce and Industry
Minister Kamal Nath described the Trade in Goods (T.I.G.)
agreement with the 10-member Asean.
The deal would be formally signed during the India-Asean
summit in Bangkok in December.
"The countries of East Asia are important drivers of
growth... with large consumption to drive global economies,"
Nath told a joint press conference of Indo-ASEAN economic
ministers, referring to the combined market of over 1.5
billion people that is waiting to be tapped.
"It took six years for India to understand the
sensitivities of Asean, and for the Asean to understand the
sensitivities of India," Nath added.
India and Asean currently enjoy a total trade of USD 38
billion and expect it to touch USD 50 billion by 2010.
The pact was supposed to have been reached last year, but
talks were held up over differences on products that India
wanted to exclude from tariff cuts. New Delhi had submitted a
list of 1,414 products, while the Asean's target number was
400.
Under the pact, India and Association of South East Asian
Nations (A.S.E.A.N.) will eliminate import duties on 71
percent of products by December 31, 2012 and another 9 percent
by 2015. Duties on 8 to 10 percent of the products that have
been kept in the sensitive list will also be brought down to 5
percent.
Nath said India has already reduced tariffs unilaterally.
Its rate on crude palm oil has been cut to zero from 50 to 60
percent five years ago. India's peak tariff rates now average
9.7 per cent compared to 20 to 25 percent five years ago.
A limited number of products will be excluded from tariff
concessions based on the domestic sensitivities of the
respective countries.
The T.I.G. has provisions for a special track for tariff
reduction for five products, which are key to exports of some
Asean members. These are for crude and refined palm oil,
coffee, pepper and tea.
Crude and refined palm oil are key exports of Malaysia
and Indonesia, while coffee, pepper and tea are the major
exports of Vietnam to India.
The two sides will also negotiate trade in services and
investment as a single undertaking as soon as possible, said a
joint statement issued by the leaders after consultations.
Malaysia will co-chair the working group on investment
with India while the working group on services will be
co-chaired by Singapore.
"India is ready. The onus is on Asean to gather its team
and start negotiations on services and investment," said
Singapore's Trade Minister Lin Hng Kiang.
At present, India is Asean's seventh largest trading
partner. Nath said India's trade with Asean is 9.6 percent of
the country's global trade, while Asean's trade with India is
only 2 per cent of the trading bloc's global engagement. "So
the potential for enhanced economic engagement between Asean
and India is profound," he said.
Asean sought to strengthen regional trade links after the
Doha Round of W.T.O. talks broke down in July because of a
dispute between India and the United States over agricultural
tariffs.
Asean Secretary General Surin Pitsuwan described the
conclusion of India-Asean F.T.A. in goods as an "important
milestone." He said the move will give impetus to the stalled
Doha round of W.T.O. talks which Asean ministers say should be
revisited.
Malaysia's Trade Minister Muhyiddin Yassin said the Free
Trade Agreement (F.T.A.) would open up huge opportunities with
reduced or no import duties beginning next year.
Indonesian Trade Minister Marie Pangestu said A.S.E.A.N.
and India had come to "a level of understanding never been
experienced before." She said the F.T.A. in goods paved the
way for more economic cooperation between the two sides. "This
will lead to a greater integration between A.S.E.A.N. and its
dialogue partner," she added. PTI JB
BDS
bloc Asean Thursday successfully concluded six years of
negotiations for a free trade agreement in goods that will
create an European Union-like single market.
A "key regional milestone" is how Commerce and Industry
Minister Kamal Nath described the Trade in Goods (T.I.G.)
agreement with the 10-member Asean.
The deal would be formally signed during the India-Asean
summit in Bangkok in December.
"The countries of East Asia are important drivers of
growth... with large consumption to drive global economies,"
Nath told a joint press conference of Indo-ASEAN economic
ministers, referring to the combined market of over 1.5
billion people that is waiting to be tapped.
"It took six years for India to understand the
sensitivities of Asean, and for the Asean to understand the
sensitivities of India," Nath added.
India and Asean currently enjoy a total trade of USD 38
billion and expect it to touch USD 50 billion by 2010.
The pact was supposed to have been reached last year, but
talks were held up over differences on products that India
wanted to exclude from tariff cuts. New Delhi had submitted a
list of 1,414 products, while the Asean's target number was
400.
Under the pact, India and Association of South East Asian
Nations (A.S.E.A.N.) will eliminate import duties on 71
percent of products by December 31, 2012 and another 9 percent
by 2015. Duties on 8 to 10 percent of the products that have
been kept in the sensitive list will also be brought down to 5
percent.
Nath said India has already reduced tariffs unilaterally.
Its rate on crude palm oil has been cut to zero from 50 to 60
percent five years ago. India's peak tariff rates now average
9.7 per cent compared to 20 to 25 percent five years ago.
A limited number of products will be excluded from tariff
concessions based on the domestic sensitivities of the
respective countries.
The T.I.G. has provisions for a special track for tariff
reduction for five products, which are key to exports of some
Asean members. These are for crude and refined palm oil,
coffee, pepper and tea.
Crude and refined palm oil are key exports of Malaysia
and Indonesia, while coffee, pepper and tea are the major
exports of Vietnam to India.
The two sides will also negotiate trade in services and
investment as a single undertaking as soon as possible, said a
joint statement issued by the leaders after consultations.
Malaysia will co-chair the working group on investment
with India while the working group on services will be
co-chaired by Singapore.
"India is ready. The onus is on Asean to gather its team
and start negotiations on services and investment," said
Singapore's Trade Minister Lin Hng Kiang.
At present, India is Asean's seventh largest trading
partner. Nath said India's trade with Asean is 9.6 percent of
the country's global trade, while Asean's trade with India is
only 2 per cent of the trading bloc's global engagement. "So
the potential for enhanced economic engagement between Asean
and India is profound," he said.
Asean sought to strengthen regional trade links after the
Doha Round of W.T.O. talks broke down in July because of a
dispute between India and the United States over agricultural
tariffs.
Asean Secretary General Surin Pitsuwan described the
conclusion of India-Asean F.T.A. in goods as an "important
milestone." He said the move will give impetus to the stalled
Doha round of W.T.O. talks which Asean ministers say should be
revisited.
Malaysia's Trade Minister Muhyiddin Yassin said the Free
Trade Agreement (F.T.A.) would open up huge opportunities with
reduced or no import duties beginning next year.
Indonesian Trade Minister Marie Pangestu said A.S.E.A.N.
and India had come to "a level of understanding never been
experienced before." She said the F.T.A. in goods paved the
way for more economic cooperation between the two sides. "This
will lead to a greater integration between A.S.E.A.N. and its
dialogue partner," she added. PTI JB
BDS
