A MATTER OF ACCESS

What is on the cards for the India-Asean FTA review

- SHREYA NANDI

Last year, Commerce and Industry Minister Piyush Goyal called the free trade agreement (FTA) between India and the 10-member Association of Southeast Asian Nations (Asean) "ill-conceived" and "unfair" to the Indian industry.

Goyal's remarks, made at a public forum, were a reflection of the inordinate delay in the review of the pact with the Asean, which consists of Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam.

The FTA came into force in January 2010. FTAs are generally reviewed within a year or two of their implementation, especially to resolve differences, if any.

India, for more than half a decade, flagged the need for an urgent review of the trade agreement since imports from Asean nations grew at a much faster pace than exports from India. That apart, the Indian industry had sought fair and equal market access across all Asean nations.

Eventually, in August last year, both sides announced the aim to complete the review of the existing agreement in goods between the two regions by 2025, giving hope to the industry of a possible course correction.

Government officials say India wants to make the deal more modern and upgrade it with the changing times, since the trade deal was signed more than a decade ago.

They also want the agreement to be more user friendly and facilitate more trade, considering the utilisation rate of regional trade agreements has been low.

"Greater market access of goods, flexible rules of origin, and addressing the issue of non-tariff barriers are also being discussed during the review meetings," one of the officials told Business Standard.

Trade imbalance