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Rediff.com  » Business » PM wants early India-Asean FTA in services and investment

PM wants early India-Asean FTA in services and investment

October 30, 2010 12:01 IST

Taking India's Look East policy a step further, Prime Minister Manmohan Singh on Saturday announced visa-on-arrival facility for citizens of Cambodia, Vietnam, Philippines and Laos; and emphasised the need to speed up the finalisation of a free trade agreement in services and investment between India and South East Asian nations.

The prime minister also stressed that all formalities for the implementation of the India-ASEAN Trade  in Goods Agreement, which was signed last year, by all the ASEAN countries be taken care of at the earliest.

"We hope that all formalities for implementing the India-ASEAN Trade in Goods Agreement by all ASEAN States are completed at an early date. The conclusion of a Services and Investment Agreement will be an important step in our goal of comprehensive economic cooperation," Dr Singh said.

Even though this is a positive step, sources said: "It is too bad that the agreement in services and investment wasn't signed between India and other South East Asian nations during the current ASEAN Summit. We had expected that it would go through this time."

Speaking at the India-ASEAN Summit in Hanoi, Vietnam, the prime minister said India's economy is expected to witness a sustained growth rate of 9-10 per cent in the coming years, which will offer many opportunities for trade and investment.

"India believes that ASEAN is the core around which the process of economic integration of the Asia-Pacific region should be built," he said.

He commended the officials of both sides for developing a Plan of Action to implement the ASEAN-India Partnership for Peace, Progress and Shared Prosperity for the years 2010-2015.  "It is an ambitious road map and the 82 Action Points reflect the vast potential and desire to develop a multi-faceted India-ASEAN relationship," he said.

"Our experience of implementation shows that we need to work very hard at all levels if we have to accelerate the pace of engagement as outlined in the Plan of Action. I recall that the theme of the ASEAN Summit this year is 'Vision to Action'. This theme is equally appropriate for our own partnership," Dr Singh said.

"For the past five years the achievement of the India-ASEAN partnership has been to initiate cooperation in a diverse range of sectors covering political and security ties, economic cooperation and the promotion of socio-cultural links," he said.

In recent years, there has been a substantial increase in people to people exchanges as a result of better air connectivity between India and ASEAN. More than 3 million Indian tourists visit ASEAN every year and about 380 flights connect Indian and ASEAN cities every week. This is well below the potential.

India has always accorded high priority to the countries covered by the 'Initiative for ASEAN integration' and the country hopes to upgrade the level of youth exchanges and establish vocational training centres in each of these countries, he said
Connectivity is another important area of India's cooperation with ASEAN. As a further measure to support the ASEAN Master Plan on Connectivity, India, he said, will offer 100 IT scholarships to each of the 10 ASEAN countries over the next five years.

Another area of cooperation that the prime minister mentioned was science and technology. "We are ready to set up a Centre for Tracking and Data Reception and an Imaging facility for the ASEAN countries. This Centre would utilise data provided by Indian remote sensing satellites and harness it for multiple developmental applications. I propose a meeting of the heads of our space agencies in India which could work out exact details of cooperation," he added.

New Delhi, he said, has undertaken programmes for a massive transformation of rural India that is creating a huge and booming rural market for goods and services.

"The conclusion of a Services and Investment Agreement will be an important step in our goal of comprehensive economic cooperation," the prime minister said about the pact negotiations for which are going on.

The India-ASEAN Trade in Goods Agreement was signed in Bangkok, Thailand on August 13, 2009 after six years of negotiations. The agreement came into force on January 1, 2010.

Seen as the world's largest FTA, covering a market of almost 1.8 billion people with a combined GDP of $2.8 trillion, the India-ASEAN pact envisages tariff liberalisation of over 90 per cent of products traded between the two dynamic regions.

India looks forward to hosting the commemorative India-ASEAN Summit in India in the year 2012. "This will be a landmark event and we must begin preparations early. The Eminent Persons Group should be set up quickly so that it can formulate a vision statement towards a long term strategic partnership between ASEAN and India that could be the theme of the Summit," he said.

The prime minister invited ASEAN secretary general Surin Pitsuwan to visit India to review the mechanisms and procedures in place so that the pace of implementing agreed projects can be speeded up.

India currently has visa-on-arrival facility for ASEAN members like Singapore, Malaysia and Japan.

Shishir Bhate in Hanoi