India-Thailand FTA: More linkage sought in tourism, hospitality
Bangkok Post
India-Thailand FTA: More linkage sought in tourism, hospitality
15 July 2004
Service sector to be included in fresh talks
By Nareerat Wiriyapong Phusadee Arunmas
Bangkok and New Delhi are looking forward to developing further linkages in the areas of tourism and hospitality to widen economic co-operation under the Thailand-India bilateral free-trade agreement, according to high-ranking representatives of both countries.
Leela K Ponappa, India’s ambassador to Thailand, said tourism, one of Thailand’s key strengths, could be used to develop further links with the hospitality sector in India.
A separate economic partnership agreement inked late last year alongside the FTA deal has provided a platform for Thai hotel operators to develop estates at tourist spots in India.
Developments in cities such as Bodhgaya should capitalise on the increasing number of Thai tourists going to India.
"The spa business which is developing both in Thailand and India is potentially an area of co-operation in the private sectors of the two countries. India has a lot to learn from Thailand," Ms Ponappa said. The service sector would be included in the next phase of negotiations under the FTA, she added.
The Thailand-India FTA is scheduled to come into effect in September with the implementation of an early-harvest programme covering 82 products. The two counterparts are soon to enter negotiations for another 5,000 items under the pact.
Tariff reductions for agricultural products will come first, followed in March by a framework for broadening the FTA, said Pranpree Mahiddha-Nukara, vice-minister for commerce.
Mr Pranpree, who just returned from a trip to India as part of the FTA negotiations, agreed that Thailand and India still have plenty of room to expand co-operation in the tourism sector.
While only a handful of Thai tourists go to India each year, some 250,000 Indians visit Thailand annually, he said.
Regarding the service sector, Mr Pranpree said the area with the greatest potential for co-operation between Thailand and India is in the field of information technology, given India’s strong human resource base.
Ms Ponappa said the first round of tariff reductions would put Thailand and India in a better position to expand bilateral trade.
Even without the FTA, two-way trade has increased strongly, to over US$855 million in the first five months of this year, an increase of 60% year-on-year. Last year’s total of $1.5 billion was 27% over trade in 2002.
Thailand has long been a key overseas destination for Indian investors.
There are 33 joint ventures in Thailand, including those led by major industrial groups Aditaya Birla and Indorama.
Ms Ponappa yesterday presided over a meeting aimed at linking up buyers and sellers organised by the Engineering Export Promotion Council.
As the largest export promotion council in India, EEPC is comprised of 12,000 firms in the engineering industry, including trading firms.
India’s total engineering exports approached $8 billion from 2002-2003. Thailand accounts for a quarter of India’s exports of engineering goods, projects and services to Asean.
India’s sales to Thailand grew 60% last year versus 30% growth across the region overall, said EPPC chairman Rakesh Shah.
