http://economictimes.indiatimes.com
15 Jul 2009
Amiti Sen, ET Bureau
NEW DELHI: Top officials from India and the ten-member Association of Southeast Asian Nations, or Asean, will meet in Manila on Thursday to lay
down the road map for the implementation of the proposed bilateral free trade agreement (FTA), which has been bogged down by many delays over the years.
The FTA, which seeks to eliminate tariffs on more than 4,000 products, including electronic goods, chemicals, certain capital goods and some categories of textiles, is scheduled to be implemented from January 1, 2010.
Indeed, talks were supposed to have been wrapped up as early as 2007, but got mired many times in tariff disputes between India and regional heavyweights Indonesia, Malaysia and Thailand on commodities like crude, palm oil, metals and textiles.
Asean members include Malaysia, Singapore, Thailand, Indonesia, the Philippines, Brunei, Cambodia, Laos, Myanmar and Vietnam.
In Manila, the officials are expected to set a time frame and milestones for the eleven governments to get the treaty approved at their national levels.
India has managed to convince Asean not to set the year-end as the deadline for implementing various phases of the tariff cuts as was originally envisaged when the agreement was scheduled to be implemented from January 1, 2009.
“Since the agreement will now be implemented one year later than originally proposed, the end dates also have to be logically extended by one year. Initially, the Asean was not agreeable to this, but we managed to persuade them,” a commerce department official told ET.
Earlier, India had also persuaded the Asean to give up its demand of executing tariff cuts twice a year instead of annual cuts. This would have forced India to cut duties at a faster rate than it is prepared to do.
As per the agreement, duties on 4,000 items out of the 5,000-odd items traded between the two sides will be brought down to 0-4% levels over six years.
While 479 items (comprising mostly agricultural products from India’s side) will be shielded from tariff cuts, duties on products marked as sensitive (like garments and automobiles), will be reduced to 5% over 3-9 years.
Although the UPA government, during its previous regime, had got the approval of various departments and ministries on the FTA, it had to seek fresh approval after the general elections.
“We had to go to each ministry and department again to seek approval. Now we are ready to place the agreement with the Cabinet for its nod,” the official said.
15 Jul 2009
Amiti Sen, ET Bureau
NEW DELHI: Top officials from India and the ten-member Association of Southeast Asian Nations, or Asean, will meet in Manila on Thursday to lay
down the road map for the implementation of the proposed bilateral free trade agreement (FTA), which has been bogged down by many delays over the years.
The FTA, which seeks to eliminate tariffs on more than 4,000 products, including electronic goods, chemicals, certain capital goods and some categories of textiles, is scheduled to be implemented from January 1, 2010.
Indeed, talks were supposed to have been wrapped up as early as 2007, but got mired many times in tariff disputes between India and regional heavyweights Indonesia, Malaysia and Thailand on commodities like crude, palm oil, metals and textiles.
Asean members include Malaysia, Singapore, Thailand, Indonesia, the Philippines, Brunei, Cambodia, Laos, Myanmar and Vietnam.
In Manila, the officials are expected to set a time frame and milestones for the eleven governments to get the treaty approved at their national levels.
India has managed to convince Asean not to set the year-end as the deadline for implementing various phases of the tariff cuts as was originally envisaged when the agreement was scheduled to be implemented from January 1, 2009.
“Since the agreement will now be implemented one year later than originally proposed, the end dates also have to be logically extended by one year. Initially, the Asean was not agreeable to this, but we managed to persuade them,” a commerce department official told ET.
Earlier, India had also persuaded the Asean to give up its demand of executing tariff cuts twice a year instead of annual cuts. This would have forced India to cut duties at a faster rate than it is prepared to do.
As per the agreement, duties on 4,000 items out of the 5,000-odd items traded between the two sides will be brought down to 0-4% levels over six years.
While 479 items (comprising mostly agricultural products from India’s side) will be shielded from tariff cuts, duties on products marked as sensitive (like garments and automobiles), will be reduced to 5% over 3-9 years.
Although the UPA government, during its previous regime, had got the approval of various departments and ministries on the FTA, it had to seek fresh approval after the general elections.
“We had to go to each ministry and department again to seek approval. Now we are ready to place the agreement with the Cabinet for its nod,” the official said.
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