A decision on the long-pending review of the existing free trade agreement between India and the ASEAN bloc is expected to take centre stage during the imminent meeting today in Indonesia. This decision, expected today, could reshape the landscape of trade relations between the two parties.
The pivotal discussion is scheduled during the India-Asean economic ministers meeting today on the sidelines of the ongoing ASEAN Economic Ministers’ gathering. As India seeks to eliminate barriers and misuse within the ASEAN India Trade in Goods Agreement, trade experts stress the importance of a mutually beneficial arrangement. If approved, formal negotiations for the Asean-India Trade in Goods Agreement (AITGA) review will commence, marking a milestone in the journey toward economic collaboration.
Once the decision on the launch of the Asean-India Trade in Goods Agreement (AITGA) review is taken, formal negotiations for the review will start, a source said, adding that the AITGA review has been under consideration for a number of years. A joint committee on review has been constituted, and has done two meetings virtually so far on the issue. The AITGA entered into force on January 1, 2010, which created one of the world’s largest free trade areas.
This move comes as India’s trade deficit widens and aims to address non-reciprocity in concessions, non-tariff barriers, and more. The outcome of this deliberation could significantly impact the trajectory of economic ties between India and ASEAN.
India’s exports to ASEAN increased to USD 25.7 billion from USD 18.11 billion in 2009-10. However, imports in 2010-11 rose to USD 30.6 billion from USD 25.8 billion in 2009-10.