The Hindu Business Line : Free trade pact with Singapore likely after polls

The Minister for Trade and Industry of Singapore, Mr George Yong-Boon Yeo, calling on the Minister for Commerce and Industry, Mr Arun Jaitley, at his chamber in the Capital on Wednesday. - Ramesh Sharma

New Delhi , Feb. 18

THE free trade agreement (FTA) that is currently being negotiated between India and Singapore should be a model agreement that would stand up to international scrutiny and the World Trade Organisation (WTO) test of a good FTA, the visiting Singapore Trade and Industry Minister, Mr George Yong-Boon Yeo, said here on Wednesday.

The FTA, which is known as the Comprehensive Economic Cooperation Agreement (CECA), is likely to be signed by the middle of this year (after the general elections).

"Our negotiations are in the final stages. We have few crucial but sensitive issues to be sorted out. It will be a comprehensive agreement. It's not that our bilateral relations hinge on the signing of CECA, but it is anticipated that the CECA would accelerate trade between the two countries," the Singapore Minister told the members of the Confederation of Indian Industry (CII). Both the sides, according to informed sources, do not have a meeting point on the issue of rules of origin. Service providers in India are seeking "comfort" that entities operating in Singapore and controlled from any third country do not take advantage of the proposed FTA between India and Singapore.

Without giving any assurance to the CII members, the Minister highlighted that his country did not make any distinction between Singapore and foreign nationals.

"There is a request from your side on services that only Singapore nationals should be allowed to take advantage of FTA. We don't make any distinctions. We allow free exchange of ownership to create efficiency in the market," he said. The Minister pointed out that Indian companies (with substantial Indian interest) operating in Singapore are included in the FTA between Singapore and the US and are taking advantage of such an FTA, making a case for the sensitivities of the operating situation in his country. "We will accommodate you as much as we can," he said.

He also said that India and Singapore were negotiating towards "dramatic relaxations" of restrictions in the aviation sector. Further, he also identified financial services as a major item of cooperation between the two countries in the coming days.

The Singapore Trade and Industry Minister later told presspersons that the thorny issues between the two sides could be sorted out in the coming days and hoped that the CECA would be signed by the middle of this year.

In his welcome address, Mr Sunil Bharti Mittal, Chairman & Group Managing Director, Bharti Enterprises, hoped that the contentious issues including rules of origin on the proposed FTA would be laid to rest at the earliest.