If all goes as planned, the much-awaited ASEAN-India Free Trade Agreement (FTA) should be inked in August during the ASEAN Economic Ministers conference to be held in Thailand.
Industry Minister of Thailand, Chanchai Chairungruang, has said that the signing of the FTA will enable member countries to reduce tariffs for more than 4,700 categories from January 1, 2010, onwards. “The Thailand Government will ensure effective implementation of the existing agreements and policies and also seek new measures to facilitate more investments from India,” he stressed.
He said the beneficiaries of this would be the 1.7 billion people who live in this economic zone which generates a total GDP of more than $6 trillion. Automotive components, telecommunications, electrical appliances and aluminum products would benefit from this FTA.
Mr. Chairungruang noted that Indian conglomerates like the Aditya Birla group and the Tatas have already made significant investments in Thailand. He aims to get more potential Indian companies to set up operations and benefit from the major incentives and attractive schemes that had been launched for this purpose. The target industries include automobile and auto components, agriculture and farm machinery, chemicals, plastics, electronics, telecom, textiles and software.
“With trade between India and Thailand reaching $6 billion, Thailand is confident that there is a lot of scope for further enhancing trade relations in the backdrop of the ‘Early Harvest Scheme’ between the two countries and also the impending ASEAN-India FTA,” he said.
The Industry Minister also said that Thailand could partner with India to extend its reach to the entire Southeast Asia and Asia Pacific region as important potential markets.
The signing of the FTA would open the South-East Asian markets for Indian exporters reeling from the shrinking of their main markets in the United States and Europe during the global economic slowdown.
Trade negotiations with the 10-nation ASEAN began in 2001 but was delayed several times due to the differences over issues like the list of restricted goods, duty cuts on farm products including palm oil and rules related to value addition. After negotiations concluded in late 2008, new differences arose on the methods of breaking customs’ barriers.
The ASEAN bloc, comprising Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Lao, Myanmar and Cambodia, accounts for 9.6 per cent of India’s global trade.
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