India is all set to sign a free trade agreement with the 10-member Association of South East Asian Nations (ASEAN), bringing the service sector and investments under the FTA.
The commerce ministry today said it has received the free trade agreements on services and investments with ASEAN and will “shortly” sign the FTA.
The finance ministers of India and ASEAN were to sign 2 agreements, one on free trade in services and the other on that in investments, during their meeting in Myanmar last week. But the meeting was postponed as Commerce and Industry Minister of State (Independent Charge) Nirmala Sitharaman was not able to attend the meeting due to domestic compulsions.
“Unfortunately, because the minister has compelling engagements here, she could not attend the ministerial meeting last week but we now have received the agreements on services and investments and the minister would shortly sign them,” commerce secretary Rajeev Kher said at a function in the capital today.
India and the 10-nation ASEAN had concluded negotiations for FTA in services and investments in 2012, but had delayed signing of the proposed Regional Comprehensive Economic Partnership Agreement that benefits all nations, which include ASEAN countries, and China, Japan and Korea.
Kher said besides manufacturing, the agreement must focus on services sector to improve composite competitiveness of the nations in the region and pressed for parallel negotiations in goods and services to facilitate the proposed CEPA.
India has proposed a circulation process for signing the pact with ASEAN. Under the circulation process, each member will separately sign the agreement and it will become effective only after the last member signs the pact.
The union cabinet had, in December last year, approved the free trade agreement between India and the ASEAN.
ASEAN members, however, have to approach their respective parliaments for ratification of such pacts.
The agreement, if implemented, will help boost movement of Indian professionals in the ASEAN region. It will also facilitate more investments in the service sector.
Trade between India and the ASEAN stood at about $76 billion in 2012-13. Both sides aim to increase it to $100 billion by 2015.
The ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.