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Free Trade Agreement

 

On September 9, 2014 India signed the Free Trade Agreement (FTA) in services and investments with 10 countries of the south-east Asian and ASEAN region.

Nine out of 10 ASEAN countries have signed the same.

Philippines is completing its domestic procedure and it is expected to sign soon. The FTA on goods was signed in 2009 and became effective from 2010.

The Services Agreement will open up opportunities for movement of both manpower and investments from either side between India and ASEAN.

The trade agreement has boosted the total trade between India and ASEAN substantially in the past four years.

The signing got delayed as it was scheduled to be signed in Nay Pay Taw, Myanmar, during the Asean Economic Ministers (AEM) meeting on August 26.

However, in view of the launch of Prime Minister�s Jan Dhan Yojana for inclusive banking, the Minister of State (Independent Charge) Commerce and Industry Nirmala Sitharaman (who was in charge of the launch of the scheme) could not attend the conclave.

 

 

The FTA in services is in line with other bilateral agreements that India has signed so far.

Some of the important articles contained in the agreement are the ones on transparency, domestic regulations, recognition, market access, national treatment, increasing participation of developing countries, joint committee on services, review, dispute settlement and denial of benefits.

Each ASEAN member state has tabled individual schedule of commitments which are equally applicable for India and other ASEAN member states.

India on the other hand has tabled three schedules of commitments � one for Philippines, one for Indonesia and another for the remaining eight ASEAN member states.

The agreement will also free movement of individuals as a brief annexure on movement of natural persons (one of the key areas of interest for India) has been included in the agreement.

This annexure defines business visitors, intra-corporate transferees (managers, executives and specialists) and contractual service suppliers.

This will help provide commercially meaningful market across in ASEAN for Indian professionals, including those from the IT/ITeS sector.

On it FICCI president Sidharth Birla has said, �It will supplement the India-ASEAN FTA in goods and help in getting greater market access for India�s professionals and service providers in the 10-member block. We are happy that an annexure on movement of natural persons has been included in the agreement, which will benefit our professionals�.

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