The Global Trade Research Initiative (GTRI) on Sunday recommended that the Indian government examine the bilateral free trade agreement with Singapore and assess it in conjunction with the ASEAN bloc.
The GTRI also suggested a similar evaluation with Thailand, another ASEAN member. This comes as India and ASEAN are set to review their trade pact with the aim of concluding the exercise by 2025.
ASEAN comprises Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. Notably, Indonesia, Singapore, Malaysia, Thailand, and Vietnam collectively represent 92.7 per cent of India’s exports and 97.4 per cent of its imports from ASEAN.
India’s exports to ASEAN were USD 19.1 billion in 2008-09, increasing to USD 44 billion in 2022-23, while imports from ASEAN rose to USD 87.6 billion in the last fiscal year, compared to USD 26.2 billion in 2008-09.
The GTRI report highlights India’s separate FTAs with Singapore and Thailand, suggesting a joint study considering the relaxed rules of origin. The report emphasizes the need to analyze imports from Indonesia, particularly coal, and proposes focusing on local coal usage.
Regarding Singapore, the report points out significant imports of electronics and suggests investigating whether the country is transhipping certain goods. Concerning Malaysia, the GTRI notes imports of palm oil, petroleum products, and electronics, emphasizing that the FTA review may not significantly impact these essential imports.
The report also compares ASEAN to the European Union, highlighting ASEAN’s operation as a group with an FTA rather than a customs union. It suggests that in FTA negotiations, India should consider separate tariff schedules for each ASEAN member to address specific trade sensitivities effectively.
