Indian companies should utilise CEPA (Comprehensive Economic Partnership Agreement) much more to increase exports to Japan and help bridge the trade deficit, Commerce and Industry Minister Nirmala Sitharaman said on Thursday.
The CEPA, signed in 2011 between the two nations, is one of the most comprehensive agreements. It has covered areas such as goods and services, rules of origin, IPR, government procurement, customs procedure etc.
“There are opportunities for Indian companies to utilise this agreement much more as trade deficit is a matter of concern,” Sitharaman said at a seminar organised by Research and Information Systems for Developing Countries.
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The Minister further said Indian traders and manufacturers must find greater market access in Japan.
“The share of Indian companies in Japanese drug market continues to be low and it is limited only to Active Pharmaceutical Ingredients (APIs). So more has to be done in that area,” she said.
Japanese Pharmaceutical sector offers a huge untapped potential for India’s pharma companies, she noted.
On IT exports to the country, she said it is very low at USD 1 billion. “I am sure will be able to serve Japanese market better,” she said.
The Minister said the trade between the two countries pre-CEPA in 2010 was USD 10.4 billion and currently it stands at USD 14.5 billion.
She also expressed concern over India’s rising trade deficit with respect to Japan.
“However, trade deficit with respect to Japan was USD 3.1 billion pre-CEPA, and now it is USD 5.2 billion,” Sitharaman said.
The economic engagement witnessed significant rise after both countries signed a Comprehensive Economic Partnership Agreement (CEPA) in 2011.