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JAIPUR: The government is trying to get Asean nations to eliminate duties on nearly 90% of the goods exported from the country as it seeks to balance trade volumes and bring the 13-year-old treaty in line with “more modern agreements”.
Earlier this week, India and the 10-nation bloc agreed to New Delhi’s long-pending demand for a review, which the government believes is crucial to ensure that two trading partners have strong ties. Since the agreement was signed, India’s trade deficit with Asean has shot up from around $5 billion in 2010-11 to $43.6 billion in 2022-23, a rise of 8.7 times. During this period, trade has increased 2.3 times to $131.6 billion, reflecting the asymmetry between growth in imports and exports.
Under the agreement, each Asean member had agreed to a different level of tariff elimination and India wants them – especially the higher income countries – to commit to greater opening-up given that free trade agreements with Australia and the UAE have seen tariffs eliminated on over 90% goods. Besides, India wants product specific restrictions imposed by Asean members withdrawn, as is the case with certain types of steel. Besides, the government is insisting that countries rework rules of origin as the current regime is seen to be porous and allows Chinese goods to be routed via third countries. Violations in goods such as set-top boxes from Vietnam, tin ingots from Malaysia, cold rolled stainless steel flat products, and cocoa of Ghana origin from Malaysia, have been reported by authorities.
While the services sector is not explicitly on the agenda, the government is also going to seek greater opening-up as someAsean members have refused to honour their obligations after pocketing the benefits on the goods side.
Earlier this week, India and the 10-nation bloc agreed to New Delhi’s long-pending demand for a review, which the government believes is crucial to ensure that two trading partners have strong ties. Since the agreement was signed, India’s trade deficit with Asean has shot up from around $5 billion in 2010-11 to $43.6 billion in 2022-23, a rise of 8.7 times. During this period, trade has increased 2.3 times to $131.6 billion, reflecting the asymmetry between growth in imports and exports.
Under the agreement, each Asean member had agreed to a different level of tariff elimination and India wants them – especially the higher income countries – to commit to greater opening-up given that free trade agreements with Australia and the UAE have seen tariffs eliminated on over 90% goods. Besides, India wants product specific restrictions imposed by Asean members withdrawn, as is the case with certain types of steel. Besides, the government is insisting that countries rework rules of origin as the current regime is seen to be porous and allows Chinese goods to be routed via third countries. Violations in goods such as set-top boxes from Vietnam, tin ingots from Malaysia, cold rolled stainless steel flat products, and cocoa of Ghana origin from Malaysia, have been reported by authorities.
While the services sector is not explicitly on the agenda, the government is also going to seek greater opening-up as someAsean members have refused to honour their obligations after pocketing the benefits on the goods side.
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