Asean India Trade In Goods Agreement (Aitiga)

As far as rules of origin are concerned, a debate is under way between commercial agents. The current AIFTA framework provides that, in one of the ASEAN countries, a minimum increase of 35% applies to a free trade regime in India. India is concerned that Chinese producers have abused it to benefit from tariff facilitation through a third country that is part of the free trade agreement, while India is even deprived of reciprocal market access. Countries have also agreed to launch a review of the ASEAN-India Product Trade Agreement to make it more business-friendly, simpler and easier for businesses to trade. “Over 21 sectors, the overall trade balance deteriorated in 10 to 13 sectors (reducing surpluses or increasing the deficit). Only the places where we have done better are ceramics, cement, paper, animal goods, etc. Only 10% of lines are excluded… Wanting to catch up with other countries in Thailand or Myanmar,” he said. Since the early 2000s, India has had a growing trade deficit with ASEAN, with imports exceeding exports by more than $6 billion in 2007-08. [11] There are concerns that gradual liberalization of tariffs and increased imports to India could threaten several economic sectors, including the plantation sector, some processing industries and the maritime industry. [11] As a dominant exporter of light industrial products, ASEAN has competitive tariffs that prevent India from accessing the industrial market in ASEAN countries.

[12] Ten years after the free trade agreement with the Southeast Asian bloc came into force, India has asked the region`s trade ministers to review the scope of the trade agreement. The official statement issued on Sunday stated: “Ministers from India and ASEAN countries have ordered senior officials to begin talks to determine as soon as possible the scope of the review, including to make the free trade agreement more trade-friendly, simpler and more trade-friendly for business.” In 2008, the total volume of ASEAN-India trade was $47.5 billion. ASEAN`s exports to India amounted to $30.1 billion , a 21.1% increase over 2007. ASEAN imports from India amounted to $17.4 billion , a 40.2 per cent increase over 2006. With regard to foreign direct investment (FDI), India`s inflow to ASEAN Member States amounted to USD 476.8 million in 2008, or 0.8% of the region`s total. India`s total direct investment in ASEAN amounted to $1.3 billion between 2000 and 2008. The trade and investment statistics of ASEAN`s dialogue partners can be accessed by www.asean.org/22122.htm. New Delhi: India continues to review its free trade agreement (FTA) for goods with ASEAN may not happen as quickly as it had hoped, as most Southeast Asian nations are reluctant to engage in delicate negotiations immediately. According to a study by Niti Aayog on India`s free trade agreements, India`s trade deficit has deteriorated in sectors that account for about 75% of India`s exports to ASEAN. India`s trade deficit with ASEAN countries currently stands at about $24 billion. Based on preliminary ASEAN data, two-way merchandise trade with India increased by 9.8 percent, from $73.6 billion in 2017 to $80.8 billion in 2018.

Late last week, the 15 countries participating in the Global Regional Economic Partnership (ASEAN) and five Asia-Pacific countries, Australia, New Zealand, China, Japan and South Korea, reaffirmed their determination to sign the RCEP agreement by November of this year. Although the ASEAN-India Free Trade Agreement has many advantages, India is concerned that the agreement will have several negative effects on the economy.

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