July 2007 is the deadline for the free trade agreement between India and the Association of South East Asian Nations, Commerce Minister Kamal Nath informed media persons on Sunday.
"We hope to reach a solution by July 2007," the minister said after the ASEAN-India economic minister's meeting held in Cebu, Philippines.
He called the India-ASEAN FTA a "contentious issue," but said that there had been significant progress on the negative list of items -- the main bone of contention for the FTA.
India had proposed that the negative list be restricted to 5 percent of the total trade on a reciprocal basis and the ASEAN accepted the proposal, he said.
"They wanted a dual cap -- on volume of trade and tariff lines. We said that is not possible," Nath said.
On the highly sensitive items list -- tea, pepper, refined palm oil and crude palm oil -- the minister said India reiterated it wants a complete standstill. Of the trade items in the normal track, India has proposed 560 items. ASEAN wants fewer, and the negotiations will continue till July.
In his speech at the fifth India-ASEAN summit, Prime Minister Dr Manmohan Singh also made a strong pitch for the FTA.
"We are strongly committed to its early conclusion and implementation," he said, after outlining how India's trade with ASEAN has risen from $2.4 billion in 1990 to $23 billion in 2005.
Bollywood also found its way into the stiff-lipped world of international diplomacy. Kamal Nath said Malaysia had suggested joint production and direction of Hindi movies.
"They said people don't understand the words, but they sing the (Bollywood) songs," the minister said, adding -- tongue firmly in cheek -- "I don't know how we can include that in the FTA."
"I believe that the India-ASEAN FTA will impart even further momentum to this growth in trade. We are strongly committed to its early conclusion and implementation," Dr Singh told leaders of the 10-nation grouping that includes Thailand, Indonesia, Singapore and Malaysia.
India was for economic integration by entering into free trade or comprehensive economic partnership pacts both with ASEAN as a whole and with individual countries, he said.
Detailing the economic environment in the country, Dr Singh said, "India is very different from the India of 1991. It is now a vibrant market place. Our entrepreneurs are aggressively investing overseas. India has also emerged as a productive and profitable investment destination.
"We have a 700 billion dollars economy that is growing at 7-8 per cent every year. In the first half of the current year, economic growth reached 9.1 per cent," he said, adding that India was actively pursuing external liberalisation by cutting down customs duty rates, which at 12.5 per cent now was quite close to the ASEAN level.
Emphasising that determination to renew linkages with Southeast and East Asia remains 'unshaken,' Dr Singh said: "This is amply demonstrated by the intensification of political dialogue and the steadily enlarging people-to-people contact encompassing all countries of the region."