Stage set for the Indo-Asean trade pact

On the eve of Prime Minister Manmohan Singh’s visit to Kuala Lumpur, Malaysia, to attend the first East Asian Summit, the government so...

On the eve of Prime Minister Manmohan Singh’s visit to Kuala Lumpur, Malaysia, to attend the first East Asian Summit, the government sought to downplay expectations from the first-ever grouping of 10 Asean countries, as well as India, China, Japan, South Korea, Australia and New Zealand.

Meanwhile, issues around the long-awaited free trade agreement (FTA) between India and Asean have been hammered out and the agreement is expected to be sealed during the PM’s visit next week.

‘‘It’s the beginning of a process. It’s not clear what the final outcome will be,’’ said Secretary (East) in MEA Rajiv Sikri of the East Asian Summit that seeks to harness the economic capabilities of the greater Asian region. The summit would be in the form of a retreat to let top leaders of the 16 countries have ‘‘free and frank’’ discussion on increasing cooperation, trade, connectivity and investment.

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Contentious issues like rules of origin have been resolved, and the Indo-Asean FTA would come into effect in a year or so, said Sikri. Union commerce minister Kamal Nath, who is in Kuala Lumpur attending an ASEAN-India ministerial-level meeting, added, ‘‘The negotiation (on FTA) is on the verge of completion.’’

The FTA encountered some hiccups after disagreements over textiles and agriculture. India-Asean bilateral trade, around $25 billion this year, is expected to grow by 30 per cent when the phased implementation of the FTA finally kicks in.

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