With Asean pact in limbo, India now looks at E Asia
Economic Times | 9 Nov, 2007
With Asean pact in limbo, India now looks at E Asia
Amiti Sen, TNN
NEW DELHI: India’s problems with the free trade agreement (FTA) being worked out with the Asean notwithstanding, the country is eagerly exploring the possibility of entering into a comprehensive economic partnership agreement (CEPA) with the sixteen East Asia Summit (EAS) members, including the 10 Asean countries, China, Japan, Korea, Australia and New Zealand.
The third EAS in Singapore later this month will give directions to the study group which has been formulated to do a feasibility study on CEPA. According to RIS director general Nagesh Kumar, who represents India in the study group preparing the feasibility study, all members are positive about an agreement covering goods, services and investments.
“We had our first meeting in July this year and have had a total of three meetings. All members are very serious about the initiative and the report should be out by the middle of next year,” Dr Kumar said. India had realised the importance of getting close to its East Asian neighbours way back in 1992, when it launched its Look East policy. Since developed countries like America and Europe had formed successful regional blocs like the Nafta and the European Union, it too felt the need to be part of a regional bloc in Asia.
Since India couldn’t be part of Asean+3 and the South Asia free trade agreement (Safta) has not yet shown signs of being a strong grouping, EAS is a good opportunity for the country to get integrated with a powerful trading bloc. India sees it as the building block for the East Asian Community envisaged by many, including Prime Minister Manmohan Singh. East Asia also happens to be India’s largest bilateral trading bloc with China and the Asean countries together accounting for $53 billion annual trade.
EAS was launched in December 2005 in Kuala Lumpur as an annual forum for dialogue on regional issues. In the second EAS, in Cebu, Philippines, in January this year, members decided to work on regional cooperation in sectors like education, energy, natural disaster mitigation, avian flu, finance and also launch a track-II feasibility study of a CEPA bringing together the 16-member countries of EAS. They also endorsed establishment of a regional economic think-tank called Economic Research Institute of Asean and East Asia (ERIA). The third summit will take stock of the co-operation in the group areas and advance it further.
JSG for carrying out the feasibility study was constituted in July this year with an expert from each country. According to Dr Kumar, EAS has a special significance for India as it is already engaged in bilateral negotiations with a number of members. Currently, negotiations for trade agreements are on with Asean, Japan and South Korea and similar arrangements are under consideration with China, Indonesia, Malaysia, Australia and New Zealand. A comprehensive economic cooperation agreement with Singapore has already been signed and early harvest scheme of an arrangement with Thailand is operational.
While regional agreements are always less ambitious than bilateral agreements, Dr Kumar said that such arrangements are more powerful. RIS has invited experts from the 16 EAS members to discuss the vision of broader regional cooperation and the potential challenges and roadmaps in New Delhi on November 12-13 as a precursor to the summit. “We want to bring out how the proposed trading arrangement will be beneficial for all members and each country stands to gain,” Dr Kumar said.
