The Hindu Business Line : India confident of free trade pact with ASEAN by 2007

India is quite confident of concluding the free trade agreement (FTA) with the Association of South East Asian Nations (ASEAN) by next year as part of its focused foray into regional trading agreements (RTAs), despite some lull in negotiations now.

Disclosing this to Business Line here in an interview, the Commerce Secretary, Mr Gopal K. Pillai, said, "We have given our revised proposals. Our negative list has gone down to 490 tariff lines that cover only 5 per cent of the total trade. We have offered now 95 per cent of tariff lines, which will attract zero or 5 per cent tariffs by 2015."

But, he said, "We are disappointed because since August 2006 in spite of their promises that they would respond, so far they have not responded to our proposal. On the other hand, they have increased their negative list from 2,700 to 6,200 tariff lines on November 17" at Jakarta in the latest round of trade negotiations We are not are sure what this actually means. So we have written to them and are hopeful to have negotiations."

He said the senior officials of the Commerce Ministry would be holding talks with the officials of ASEAN countries on December 8 in the Philippines, to be followed by the trade ministers' meeting there in the run-up to the India-ASEAN Summit meeting being held on December 12 in which the Prime Minister, Dr Manmohan Singh, would hold talks with his counterpart leaders of the ASEAN.

Negative list

Mr Pillai made it clear that "India could not accept the position where the negative list or sensitive list of ASEAN will be higher for India than it is for China.'' He said that the five developed and five least developed countries (LDCs) of ASEAN have their own individual problems to sort out before presenting a common stance on the negative list or items to be traded with or without tariff concessions. "We have one negative list and one sensitive list. But they have 10 negative lists," he added.

Pact with Thailand

Asked about the adverse fallout of India-Thailand FTA under which India's exports to Thailand have not picked up at the same pace at which Thai imports are surging, Mr Pillai said, "we don't have an FTA with Thailand. We have only a framework agreement for 84 items in the Early Harvest. That is all. We don't want to waste our energy with individual FTA when we can do a consolidated FTA with ASEAN."

He said that till multilateral trade talks resume under the WTO dispensation, FTAs and RTAs are the second best options to take advantage of complementarities.