ASEAN concludes free trade deal with India
Agence France-Presse | 28 August 2008
ASEAN concludes free trade deal with India: ministers
SINGAPORE (AFP) - ASEAN nations have concluded a deal for free trade in goods with India, the bloc’s seventh-largest trading partner, ministers said Thursday.
Singapore’s Minister for Trade and Industry Lim Hng Kiang and India’s Minister for Commerce and Industry Kamal Nath announced the deal, covering billions of dollars in trade, at a news conference during ASEAN meetings in Singapore.
Senior officials agreed on the pact earlier this month. It is to be signed at the Association of Southeast Asian Nations’ (ASEAN’s) Bangkok summit in December.
Nath expressed "deep satisfaction" at the conclusion of the deal, which followed difficult negotiations.
"This is an important milestone for our region," he said.
The agreement, covering more than 1.5 billion people, brings ASEAN a step closer to completing the bloc’s trade ties with all its key Asia-Pacific trading partners.
After India, the only remaining deal to be finalised is with Australia and New Zealand. Ministers say that deal is nearly completed.
ASEAN is seeking to strengthen regional trade links after the so-called Doha Round of global trade talks broke down in July because of a dispute between India and the United States over agricultural tariffs.
Total trade between the 10-member ASEAN and India amounted to 37 billion US dollars in 2007, up 29 percent from the previous year.
India is seventh on the list of ASEAN’s biggest trading partners, trailing Australia, South Korea, China and others, according to ASEAN figures.
The agreement covering trade in goods but not services between the ASEAN states and India was supposed to have been concluded last year.
But talks became bogged down by differences over products which India wanted excluded from tariff cuts. New Delhi had submitted a list of 1,414 products, while ASEAN’s target number was 400.
At their annual summit in Singapore last November, ASEAN officials said the grouping would not resume negotiations with India until it came up with a better offer.
India adopted a free-market economy in the early 1990s and was keen to expand trade ties with ASEAN, but it also wanted to protect sensitive sectors such as agriculture and textiles, which provide livelihoods for millions.
Lim and Nath both said the deadlock was finally broken through determination, flexibility, and "understanding of sensitivities".
ASEAN has already agreed to gradually tear down barriers to trade in goods and services with China and South Korea. It has also signed a wide-ranging economic partnership deal with Japan, which also covers investments.
ASEAN itself aims to achieve a single market and manufacturing base by 2015 to raise its profile in the face of competition from China and India. The bloc already has cut to between zero and five percent tariffs on 90 percent of goods traded between its diverse members.
