Macro Economy

India-ASEAN FTA needs to be expanded: Vietnam envoy

Our Bureau New Delhi | Updated on July 30, 2018

The free trade agreement (FTA) between India and the 10-member ASEAN needs to be upgraded and expanded for the pact to deliver desired results, Vietnamese Ambassador to India Ton Sinh Thanh has said.

“The India-ASEAN FTA has not led to as much expansion in trade between the two countries. There is definitely a need to upgrade it and both sides are considering it. There is a need to expand the agreement to include more products,” Thanh said, speaking at an interaction with the media organised by the Indian Women’s Press Corps on Monday.

Stressing on the opportunities for an expansion in trade that existed between the two countries, Thanh said if trade was opened up, there was a possibility of bilateral trade expanding from the present $7 billion to $20 billion.

Giving an example, the Ambassador said that Vietnam imported about $10 billion of fabric for its textile industry every year. “India has the capacity of meeting our demand for textile inputs. If trade is opened up, we could be importing a lot of this item from India,” he said.

The trade deficit between India and the ASEAN has increased after the FTA in goods was implemented in 2009. According to industry figures, trade deficit has worsened account for approximately 75 per cent of India’s exports to ASEAN.

Thanh pointed out that Indian investment in Vietnam was low and there was a lot of potential for it to increase. “We know that Indian companies invested about $40 billion outside the country last year. Of that only $100-150 million was made in Vietnam. However, we do expect levels to rise as big Indian companies like Mahindra and Adani are looking for opportunities in Vietnam,” the Ambassador said.

Published on July 30, 2018

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