INDIA AND ASEAN DISCUSS FREE TRADE AGREEMENT – AGREE TO ESTABLISH ASEAN-INDIA ECONOMIC LINKAGES TASK FORCE

INDIA FOR FTA WITH ASEAN – MARAN

OUTCOME OF FIRST ASEAN-ECONOMIC MINISTERS – INDIA CONSULTATION

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Shri Murasoli Maran, Union Minister of Commerce & Industry, has said that India is very keen to engage with the ASEAN and would like to have a Bilateral Regional Trade and Investment Agreement (RTIA) or Free Trade Area (FTA) with the ASEAN in the long-term so as to make this economic integration meaningful. This was said by the Minister while addressing the First ASEAN Economic Ministers (AEM) – India Consultation held at Brunei Darussalam on 15^th September, 2002. The meeting was historical in the sense that for the first time, the Trade Minister of India and ASEAN met to discuss the issues of enhancement of trade and investment linkages and economic integration between India and the ASEAN. Shri Maran led the Indian delegation at the consultations, which was co-chaired by Mr. Pehin Dato Abdul Rahman Taib, Minister of Industry and Primary Resources, Brunei Darussalam. The Ministers agreed that a Regional Trade & Investment Agreement between ASEAN and India should be the long-term objective. They also agreed to establish a ASEAN-India Economic Linkages Task Force, which would submit its recommendations, including the draft of a framework agreement to enhance ASEAN-India trade and economic cooperation. The Task Force would also include members of the private sector.

The first summit of leaders of India and the ASEAN is to be held in Phnom Penh, Cambodia, in the first week of November, 2002. The Prime Minister, Shri Atal Behari Vajpayee, is expected to attend the summit.

India would also be hosting the First ASEAN-India Business Summit in New Delhi on 17^th October, 2002 and in Hyderabad on 18^th October, 2002. The Business Summit will bring together policy makers, top businessmen etc., and will provide vital economic inputs for the First ASEAN-India Summit in Phnom Penh in November 2002.

The Ministers exchanged views on broad aspects of the present global economic climate in general and recent developments in ASEAN-India in particular. They noted with satisfaction the recent trends in ASEAN-India trade, which grew by 30% from US $ 7.6 billion in 1999 to US $ 9.88 billion in 2001. The ASEAN Economic Ministers welcomed the efforts to bridge the gap between ASEAN’s average tariff and Indian tariff and also Mr. Maran’s expression of interest in having a bilateral RTIA or FTA as a long-term goal of ASEAN-India economic relations.

To further enhance the trade and investment flows between India and ASEAN, a Joint Study was conducted recently on "AFTA-India Linkages for the Enhancement of Trade & Investment". The Ministers noted the broad views of this study, which recommended the formation of an India-AFTA Regional Trade & Investment Area and emphasised that the future economic integration of ASEAN-India could include, among others, the following broad issues namely, market access including removal of non-tariff barriers (NTBs); trade and investment facilitation measures such as harmonising standards; facilitating business travel; and trade and investment promotion measures.