India & ASEAN Sign FTA

India and the Association of Southeast Asian Nations have signed a free trade agreement after more than six years of negotiations in Bangkok o n 13 August 2009.

According to the agreement, which will be implemented from January 1, 2010, duties will be eliminated on about 3,200 products by December 2013. For the rest 800 products, duty will be zero or near zero by December 2016. These include electronics, chemicals, machinery and textiles. But the deal does not embrace software and information technology.

Tariffs on sensitive goods will be reduced to 5% in 2016, while the agreement excludes nearly 489 very sensitive products from tariff cuts.

Trade between India and ASEAN amounts to $40 billion each year. India has got the market of 1.1 billion in population and ASEAN of 550 million. The size of the two combined will be much bigger than China, Japan and South Korea put together.

The signing in Bangkok marks ASEAN's fifth such agreement after the ASEAN-Japan FTA, the ASEAN-China FTA, the ASEAN-Korea FTA and the ASEAN-Australia and New Zealand FTA.

ASEAN comprises of Thailand, Singapore, the Philippines, Indonesia, Malaysia, Burma, Laos, Brunei, Vietnam and Cambodia.

Back to Index of August 2009