ASEAN for early FTA with India
The Hindu | 15 August 2007
ASEAN for early FTA with India
P. S. Suryanarayana
Both engaged each other
Concern over India being protectionist about crude imports
Commerce Secretary in Kuala Lumpur for talks
SINGAPORE : The Association of Southeast Asian Nations (ASEAN) is keen on clinching a Free Trade Agreement (FTA) with India by or before the November bilateral summit here. However, the anticipated end-game in the ongoing negotiations required “very hard work,” highly placed sources on both sides said.
Prime Minister Manmohan Singh and leaders of the 10-member ASEAN, who met at Cebu (Philippines) last January, set a July-end timeline to firm up the proposed FTA in regard to goods as different from services or investments. However, the passing of the deadline is not being treated by either side as the collapse of these trade talks.
ASEAN Secretary General Ong Keng Yong on Monday told The Hindu over telephone that “the good thing” was both sides were still engaging each other seriously despite a lot of to-and-fro tactics. Mr. Ong said a new issue now was the sentiment in some sections of the ASEAN that India was being “protectionist” about its imports of crude and petroleum products. Significantly in this context, the ASEAN did not vigorously raise the issue earlier, because the interested member-states had pinned their hopes on a general tariff liberalisation across the board, he pointed out.
Petroleum and the related products fall in India’s sensitive list for customs levies, and these items attract an import duty of only five per cent. Yet, Brunei, Malaysia, and, to some extent, Indonesia are the ASEAN members vitally interested in seeking a tariff sop over this issue.
“Not yet resolved,” either, was the earlier dispute over the quantum of India’s offers of tariff concessions on its imports of palm oil from the relevant ASEAN countries, Mr. Ong indicated.
Commerce Secretary G. K. Pillai, in Kuala Lumpur for bilateral talks with his Malaysian counterparts during the week-end, later told The Hindu the trade parleys with the ASEAN were now heading towards a “make-or-break” p hase. In a conversation over phone, Mr. Pillai said Commerce Minister Kamal Nath would meet his political interlocutors from the ASEAN in Manila later this month under the association’s calendar of regular events.
He said the “few outstanding issues” were not confined to just one or two product lines. On the petroleum issue, he said India “can look at” any specific proposal such as Brunei’s, given its trade profile.
A more important reality, though, was that several ASEAN countries had not yet given India their respective “exclusion lists,” Mr. Pillai said.
To this, Mr. Ong’s reply was that these ASEAN countries were now being hustled to speed up the talks.
Besides engaging in some hard bargaining over several farm commodities, the ASEAN tends to look at its trade talks with India under the prism of China’s earlier “gestures” towards the association in signing FTAs in respect of goods and services.
