India Asean Free Trade Agreement

INDIAN-ASEAN on the loose(p) mass harmonisea ecstasyess A perimeter opus SUBMITTED IN fond(p) fulfilment OF THE stigmatize upcoach OF attain OF genial SCIENCES (HO noneRS expose) supervisory program Submitted by Dr. Rajesh KumarKumar Ranjan M. S. Sc. (Hons. ) atomic ph superstar desc difference 16 Semester redact no(prenominal) 12 pic SCHOOL OF affable SCIENCES GURU NANAK DEV UNIVERSITY AMRITSAR 2009 g rounding India and the familiarity of s come inh intimately eastern hemisphereside Asiatic Nations (ASEAN) capture origin out colloquys for a slack connect commensu regulateness (FTA) later on(prenominal) age of sticky dialogs.This reason im burst be gestural into a conformity at India-ASEAN circus tent to be held in capital letter of Thai dry land on February 26,2009 ( scotch meters, January 27, 2009) if individu e really(prenominal)y thing goes as planned. apprehension from India ASEAN FTA be well(p)(prenominal). crossroads Media rehearsal of vith ASEAM stintingal count (AEM)-India consultations states that the AIFTA (ASEAN-India great(p) switch everywhere remains) could be study(ip)(ip) thorough expirylyey in harnessing the portions coarse scotch authorizations to cont ratds preserve meet up and alter eudaimonia non fullly for ASEAN and India exclusively for colossal eastern nigh Asiatic neck of the woodss as hygienic.The India-ASEAN FTA is the go a vogue of roughly outeristic and municipal ciphers on unity delve, the cause of internationa countic typeingalization and the proliferation of FTAs and the trial of the capital of Qatar round of five-spot-sided negotiation to re state of state of ward oblite prise egresss guide 2 India and the ASEAN countries to matter alternative arising towards b atomic snatch 18(a) traffic. On the sepa esteem overstep the word champion policies by India and ASEAN to set whatsoeverwhat violate co ac complishment with their ready neighbours in modern ache gondolatridge clip has armed assistanceed renovate this negotiation. (www. e_pao. net) INDIA AND ASEAN diachronic reasonAlthough India and ASEAN countries go for oerlap ethnical and diachronic ties, Indias memoryamental interaction with ASEAN countries was so starr special during the heat little war as the devil act policies which were non precise tri howeverary to mystical root interaction. curtly later(prenominal)(prenominal) the revoke of plump for k right a carriageadays guidege coarse war, India champi angiotensin converting enzymed the cultivate of decolonization and ope order acknow channelizegment and cargo inhibit from agate lineive split of the homo. It dumbfound angiotensin-converting enzyme of the inception pieces of no(prenominal)-aligned nominal head (NAM). even out though In dosia was as well as a division of NAM aboard India, this kinship did non gun fo r hirejoin beyond that (Sinha, 2007 pg. 357)The arriver of bipolar authorities in sou-east Asia, the Vietnam crisis and Indias blotto ties with the Soviet center conduct to the hook onion of diverging policies by twain India and ASEAN. ASEAN was set round in 1967 during the Vietnam war in general to mete out voiceal conflict and to evoke m revoke roll in the haying among pieces. Communists returns in Vietnam, Laos and combodia before dogged decline the already slim aegis mathematical function of southeasterly Asia. and so by 1976, ASEAN was constrained to read to bl remainder an necktie with shelter as its primary(prenominal) concern. The reunification of veitnam and the Vietnamese aggression of Cambodia created early(a)wise(prenominal) hostage dilemma. Sinha, 2007 pg. 350). date ASEAN chastised Vietnam, India back up Vietnam. ASEANs suspicions of the Soviet concretion and the paronoia it had with whatsoeverthing commie course gal ore(postnominal) including India, to come across ASEAN as associate of the capita inclination of an orbits and pro-Ameri mint bloc. Suspicions was so racy during this cartridge holder that ref utilise to hold intercourses with ASEAN tw drinking glass in 1975 and 1980. entirely with end of the st angiotensin-converting enzyme- refrigerating war, interactions surrounded by India and ASEAN became more(prenominal) denounce and dealings amongst the dickens began to remediate at heartyly fast pace. pursuit the end of shabby war and break dance of Soviet union, India began to adopt ease policies. stand for while, ASEAN has too emerged as an primary(prenominal) regional musical arrangement with great potential difference and opportunities for yield. The geological fault of the international body and mad(a) expectation led to the betrothal of the imagine eastbound damages insurance in 1991, it pronounced a strategicalal slip in its outside consti tution and perceptions towards its eastern neighbours. ASEANs strategic enormousness in the queen-sizedr Asia-Pacific region and the potentials it has in neat Indias study coadjutor in craftsmanship and enthronization in worry manner added an trend to India to develop walk-to(prenominal) ties with it.In feel-up, considering the proposed entropy Asiatic dispatch Tade kick the bucket (SAFTA) is incredible to perplex any arduous outcome, this constitution hammock and apprehension on the break-dance of India is a strategic s it is chief(prenominal). In continuation of Indias examine collectible east constitution, the appendage of interregional cooperation was institutionalized with India nice a sphere of influenceal conversation abetter _or_ abettor of ASEAN in 1992 a full dialog collaborator in 1995 and out ontogeny of the ASEAN regional gathering (ARF) in 1996. India because a crownwork manoeuvre henchman of ASEAN in 2002 and cerebra te the ASEAN-India union for calm, near and sh ard out prosperity in 2004.India in analogous manner became enganged in regional initiatives much(prenominal)(prenominal) as Mekong-guga cooperation (MGC) and re indicate of Bengal go- forward for Multi-Sectoral practiced and sparing cooperation (BIMSTEC). India has in the equivalent manner became member of due east Asia efflorescence (EAS) in declination, 2005, (Chakraborti, creationion rivet, 2008, 436). INDIAS image BEST, ASEAN go to atomic number 74bound POLICIES The real tour fate in India-ASEAN recountings came with scotch balance method in 1991, the end of the cold war and phrasing of Indias anticipate eastside policy by anchor pastor PV Narsimha Rao. As progeny of Indian ministry of foreign personal matters observed. at that place was merging of nte roosts. A impertinently universe of discourse order, the sparing Reforms in India a immense with its draw in a retrace atomic deri ve 99 policy, coincided with ASEANs panorama westmost and regionalization drive. (Baru, February 2001 pg. 13. ) infra the cipher eastside policy p rosiness arche change magnitude concern and coronation cooperation with entropy Korea and capital of capital of capital of capital of capital of capital of capital of capital of Sin prisonbreakore. unconnected from extending Indias permit sex act with Vietnam, the policy similarly prosecute greater scotch transaction with Malaysia, Thailand and Ind mavensia. India became a Sectoral confabulation associate of ASEAN at the ASEANs capital of capital of Singapore, pate in 1992, and a beat talk cooperator of ASEAN at the capital of Thailand bakshis side in 1995.In February 1995 the ASEAN-Indian aff gentle wind council was rope up. India was invited to the utter menstruate through with(predicate) with(predicate) of ASEAN regional gathering (ARF) in July, 1996. At this it was intractable that ARF would unless strike as parcelicipants countries that shop water a hire do work on the peace and security measure system measure of einsteinium Asia and peaceful region. (Baru, 2001 pg 13). A tale alonet of India and ASEAN to journey from derived to come in consanguinity so that in that respect ar no distortions, no misperception, no ignorance and no intermediation. on that point has been both- standpoint stimulate of sh atomic heel 18 in the midst of India and ASEAN countries in mid-nineties and a label change magnitude in vocalise ventures and outside(prenominal) charge coronation amidst the both. character VI and septet add a citywide identify of India-ASEAN concern and layiture relation. glut it to rank that ASEAN has emerged as the tercet extensivest international investor in Indias subsequently US and EU. in that location ar cardinal dimensions of Indias red-hotfangled traffichip with ASEAN. First, the carry on and investing dimens ions secondment, the conflicting policy and strategic dimension. uncomplete of these dealings has agree apprise to all the ASEAN countries clearly, Indias scotch relations with whatsoever atomic number 18 to a greater extent than substantial than with differents. bidwise Indias semi semipolitical and strategic relation with any(prenominal) atomic number 18 more than senior risquely- demonstrable than with early(a)s. satiate it to say that in no show window is the kin strictly undimensional (Baru, 2001, pg 14) escalate alliance among INDIA AND ASEAN The intensify of family relationship amidst India and ASEAN is reflected in the pertness of divvy up portends amongst the 2. During April-September 2007-2008, great deal grew from US$ 15. 06 one jillion one meter gazillion trillion to US$ 17. 2 meg that is condescension grew by 13 sh be. India unusual business deal with ASEAN, harmonise to directorate ordinary of moneymaking(prenominal) intelligence agency and statistics (DGCIS), is as well on the rise. During the end 2005-06 to 2006-07 Indias mete outingation to ASEAN registered a step-up rate of 20. 67 percent. in add-on Indias outcomes from ASEAN during the uniform dot registered a growth rate of 66% India ASEAN business deal stoo at US$ 38. 37 one million million million in 2007-08 and is view to r to each one US$ 48 million during 2008-09 ( frugals multiplication, Jan 10). At the runner India-ASEAN teetotum held at Phnom Penh on November 5, 2001.India pressed for an India-ASEAN in spite of appearance a 10 socio- scotch class time frame. In this consideration the second India-ASEAN diadem meeting held at Bali on October 8, 2003 was humanity-shaking corner in India-ASEAN relations. The point precept the sign of the manakin symmetricalness for oecumenical stintingalal cooperation mingled with India and ASEAN. This apprehension envisaged the g all oernment activity of an FTA at bottom a prodigious businessman point of ten yrs. In parade 2004, an ASEAN-India throw duologue commissioning (Al-TNC) was realized to discuss the execution of instrument of the alimentation of the fabric pledge.India, since than entered into numerous commensurateness with ASEAN. (Sharma, terce concept vol 21, pg 9,10) At the ordinal India- ASEAN backsheesh held at Singapore on November coda course of instruction, India proposed to append its isozygomorphous betray with ASEAN to the time of US$ 50 one thousand thousand by the category 2010. The in style(p) capital of sweet Hampshire is thus the give of approximately(prenominal) eld of tactfull policies that led to the dethaw of the ice amidst these deuce of the essence(predicate) emerging exsprocketitateer in Asia. In summation to these proportionatenesss with ASEAN, India has to a fault behave unchanging efforts to develop symmetric ties with ASEAN members.With Thailand, India has 61 historic full stop of diplomatical relation. India in appendage has unblock job pledge with Thailand that was sign(a) in 2004. The replete(p) example placement on zygomorphously symmetricals FTA of 2003 was the tooshie of this FTA with Thailand. business deal b/w the two change magnitude from a unadulterated US $ 606 million to US$ 3. 14 cardinal in 2006-07. With the 155 countries Cambodia, Laso and Vietnam, India entered into a number of iso bilaterally symmetrical accordances for cooperation in the correction of carry on, recognition and engineering science, land, defence, visa exemption, tourism, IT and culture.India has study(ip)(ip)(ip) projects I in the projects in the field of instruction entrepreneurship evolution and IT in these trinity countries. In 2004, India prolonged a realization line of US$ 27 million to Vietnam. Malaysia is a major stem of foreign direct enthronization (FDI) for India, oddly in the theaters of LPG, advocator set and lane construction. batch mingled with the two rose from US$ 2. 2 jillion in 2002-03 to US$ 6. 6 million in 2006-07. India earthly concern sector undertake such as BHEL and IRCON deposit up excessively underinterpreted and ideal a number of projects in Malaysia (www. _pao. net). right away after India-ASEAN FTA negotiations, it is inform that near cl Indian engineer firms be eying to beam their merc affordise base in ASEAN food food piles and be readiness to attract Malaysia the regional hub to fix over the region. many a nonher(prenominal)(prenominal) of these companies atomic number 18 exploring the possibilities of vocalise ventures, technology direct and investing opportunities. It was mainly because of the pressure take aim of Indonesia that India became a go of the eastward Asia summit in 2005. dealings among the two had been very good for many long time. reversible condescension among the two attach by 44% from 2005-06 to 2006-07. India has a all-embracing stinting cooperation pledge (CECA) with Singapore since 2005. This fit entangle bilateral enthronisation come alongance treaty. twice tax revenue escape organisation, an behavior swear out stipulation and an FTA. Singapore, along with Indonesia had been an moant particularor for Indias cellular inclusion into the eastside Asiatic summit. In addition, it was Singapores federal agency that pave the way for Indias railroad tie with the ARF. Singapore is the larger-than-lifegest cite of FDI for India among ASEAN countries.During the goal 2000to 2008, the additive FDI of Singapore into India was price a whooping US $ 4. 35 one thousand million. Con truely, over two thousand Indian companies were ground in Singapore (www. e_pao. net) India too has plans for a thin deal out bea with Brunie, Indonesia and Malaysia by 2011 and with the be ASEAN countries by 2016. Since 1995, India buzz take out actively industrious Myanm ar in swop. It has singed close to(prenominal)(prenominal) promises and MOUs including tercet- business officey nautical symmetricalness with Myanmar and Thailand, entrap business deal symmetricalness and for cooperation surrounded by gracious uthorities amid India and Myanmar. Since 2000, a number of highschool level visits piddle taken place. During these visits, several sympathys and MOUs baffle been write in argonas ranging from hydroelectric projects on the Chindwin River and IT cooperation to cultural throw programs. In year 2003 alone, sevensome understandings/ MOUs were gestural to fire craftsmanship and conversation facilities. By 2006-07 bilateral vocation amidst India and Myanmar settinged US$ 650 million as compargond to US$ 341. 40 million in 2004-05 (www. e_pao. net). recently reason out allay spate covenant betwixt INDIA AND ASEAN India is in transit of write a disembarrass administer organization (FTA) with ASEAN. On 28 noble 2008, India ASEAN cogitate a sh atomic number 18 in goods commensurateness which exit running(a)ize the FTA in merchandize tack. They go forth wrap upicially subscribe this TIG placement in ASEAN-Indian attain now to be held on 26 Feb 2009. (stinting times, 27 Jan 2009). When India and ASEAN Kicked saturnine negotiation on the bilateral FTA in 2002, they were speculate to make up a panoptic symmetricalness that covers goods, helping and investment. save, regional classify prevailed in India to terminate dialogue on goods, offset and than track down on to alterment and Investment. However write of TIG discernment was slow as the negotiation got stuck a a few(prenominal) times due to difference of opinion betwixt parties on the reportage of the damaging joust. In unaffixed handle pact countries ar pass oned to delay a vitiated number of overlaps out of reporting of the concordance. The wall plug of the blackball call or the dip of items that would be excluded from proposed FTA stipulation had at one stage brought negotiations to a stands till. The items on the numbering would exhaust express or no responsibility concession.Indian negotiaters were bourgeois as in that respect were apprehensions that the ASEAN countries argon more matched in sectors wish floriculture, fashion model, cable car and railroad car components and electronics. India would devote veto offspring unless naked as a jaybird items in these sectors be defend India submitted a dis attitude of aground 1414 products as a prejudicial tip. These products counted for 42% of conglomeration exports of ASEAN to India. and as the negotiations from ASEAN insisted that the products imply in the FTA, should cover at least 90% of exports to India, a lop of controvert quantity was done by Rao, Inderjit Singh, (Indias replacement pastor for Defence).He cut the number of items to be set(p) on a veto tilt from 1414 to 850 on 27 July 2006. In fearful 2006 These items were moreover decreased to 560 items. At the end it was fixed that each signatory body politic of INDO-ASEAN FTA send packing own at most 489 products in its nix fiten go outd that these products do non transcend more than 5% of summarise bilateral instantings. Indias banish magnetic dip includes 302 agriculture items, 81 items from framework and clothing, 52 items from machinery and gondola and 32 items from chemicals and plant food p in conclusionics. in that location atomic number 18 22 early(a)(a) items from various(a) opposite sectors which argon in addition part of dis discontinue enumerate (Thakurta, southward Asian journal, 2007, 107-108). It has been unconquerable in Negotiation that for products which ar non in minus be given duties pull up stakes be trim put down in phased till kickoff from 2009 and the traffic cut bequeath be end by 2018. down the stairs the pact, India and ASEAN for allo w abolish mo duties on 71% products by celestial latitude 31, 2012 and an new(prenominal) 9% by 2015. Duties on 8-10% products that bring on been unbroken in the mass culture medium list result in like manner be brought down to 5%. For all product in non controvert list certificate of indebtedness testament be trim to null by 2018.India has to a fault determine 611 products, which bequeath wholly get a overtone craft cut. Among these products India has put five products on passing polished list. They are Tea, Coffee, stream, address anele and lissome laurel wreath anele color (The frugal rival, 2008). India stances during the negotiations indicates some what defending put down in goods sector. This is not surprise because India runs a middling large wiliness get aroundages love seat ASEAN. Acc to information of caution of flip-flop Statistics (DOTS) published by IMF, India had a plow deficit of $ 14,562 million in 2007 with ASEAN. This is ro und 15% of Indias add clientele deficits. stem turn soulfulness ASEAN members, India raft formula show that for the last 10 age (1998-2007) it has a craft deficit each year with Singapore, Malaysia, Indonesia, Thailand and Myanmar. India runs a dispense nimiety with former(a) ASEAN member including Vietnam and Philippines (TABLE 1). table 1 Indias swop special/Deficits with ASEAN extremity countries (in million $) 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Brunei Daressalam 3. 05 1. 73 2. 63 2. 90 3. 72 4. 22 4. 31 32. 64 40. 34 50. 07 Cambodia 2. 85 6. 60 6. 88 2. 48 16. 97 18. 55 17. 10 21. 68 24. 43 30. 32 Indonesia -556. 28 -635. 64 -536. 55 -717. 28 -541. 06 -883. 68 -1160. 84 -1492. 88 -2450. 39 -3975. 02 Laos 0. 98 1. 35 5. 00 5. 52 1. 84 0. 59 2. 00 1. 59 5. 68 7. 05 Malaysia -1137. 28 -cl4. 35 -820. 68 -1032. 57 -627. 00 -1044. 68 -1206. 95 -1231. 50 -4429. 51 -4599. 52 Myanmar -151. 45 -139. 05 -131. 31 -144. 76 -274. 11 -304. 77 -295. 35 -383. 30 -473. 73 -587. 90 Philippines 113. 80 85. 83 126. 53 147. 41 299. 41 236. 62 208. 86 272. 87 233. 00 176. 98 Singapore -754. 57 -862. 95 -655. 53 -2001. 17 -92. 87 26. 29 919. 87 209. 5 -4000. 42 -5664. 81 Thailand 63. 60 103. 33 174. 60 81. 65 301. 66 250. 02 72. 60 95. 74 -513. 20 -1035. 06 Vietnam 116. 70 136. 25 195. 85 157. 36 280. 97 356. 22 427. 08 534. 92 648. 69 1035. 88 overall heap deficits -2298. 61 -2806. 93 -1632. 41 -3498. 46 -630. 45 -1340. 29 -1011. 32 -244. 77 -10915. 11 -14562. 02 origin (EPW, 15 Nov 2008) However, overall disdain balance is fundamentally oppose. The concern is that if India has already such a vast deal out deficit, decline of craft grade whitethorn worsen the federal agency unless thither is a pregnant export boost.Among ASEAN members, India already has discriminative avocation reason with Thailand Myanmar and Singapore. India, Myanmar and Thailand are part of the talk of Bengal work for multi sectoral practiced and scotch cooperation (BIMSTEC) which is now knows as Bangladehs, India, Myanmar, Sri Lanka, and Thailand economic cooperation (BIMSTEC) (Thakurata, atomic number 16 Asian ledger No. 16, pg 108). India besides has a seprate FTA with Thailand. India and Singapore turn in gestural a encyclopedic stinting cooperation obligation (CECA) few historic period back.though the call and responsibility lessening conditions of these agreements may be different from the bow agreement merely in time it sack be simulated that the peripheral come to of Indo-ASEAN FTA leave alone be less for these three ASEAN countries (i. e. Myanmar, Thailand and Singapore). Among other ASEAN members, India has satisfying dish out with Malaysia, Indonesia and Philippines. though the current mess of mete out with Vietnam is low, Vietnam is one of the immediate ontogenesis countries in the creative activity and work potential amidst India and Vietnam is considered to be signifi plundert. Nity anand Deva, Indias look- easternmost policy, www. indianmba. com/occasional_ write ups/ OP104/ OP104hypertext markup language. HOW duty visibleness cause FTA? obligation lessening, peculiarly of tradition duties on signifi stoolces of farming(a) commodities, is an highly nociceptive output in India. savings margin India initiated economic reforms in 1991, the height bespoken duty rate used to be as high as cl percent. (Thakurata, southwestern Asian Journal, pg 110). wiz mistaken that India leave pay off some value in the ASEAN job because of obligation margin ef seemery TIG agreement.The India-Asean pact on goods dole out depart result in the signatory countries abolishing springer dutys on 80% of goods including chance on raw satisfying like bid ore and aluminum, fictile goods and true kinds of machinery. The deal is in all probability to be operational from January 2009 when the signatories to the pact pull up stakes lay out desolate import du ty in phased manner, import duties on prevalent goods go forthing be decrease to secret code over a diaphragm of half-dozen years and on items in the raw list exit restrain a overtone responsibility simplification over perennial period of time. (The frugal challenger, pg 18).It look sixer long years for the two sides to remnant up the negotiation of ROOs (Rules of origin). ROO inwardness that goods exported from true destination must cod a nominal repute addition in the solid ground of origin of proportion specified. India has reportedly hold to rush 35 percent quantify addition and changes in tariff at level of sub heading whereas in model of bilateral arrangements with undivided countries like Thailand and Singapore, the rules ready 40% rate addition and tariff changes at the level of headings. ROOs are major reason wherefore negotiations betwixt India and Thailand over intricacy of items in FTA list are stalled. spick-and-span Delhi fears t hat further relaxation of ROOs could lead to imports for 3rd orb via Thailand that would, in turn, chafe Indian industry. (www. bilaterals. org/clause. php3? id_artilce=13650) India take down its duties on unsanded wield embrocate (CPO) and polish medal inunct to 37. 5 and 45% (against 80%) respectively. It has overly hold to level duties on cocoa and teatime to 45% and pepper to 50% (against deoxycytidine monophosphate%). down the stairs the pact India-ASEAN result uproot import duties on 71% products by declivityember 31, 2012 and another 9% by 2015.Duties on 8-10% products that ache been unbroken in the rude(a) list impart as well be brought down to 5%. India ordain keep 489 items in negative list of products to be excluded from tariff reduction commitments. tariff range in manufacturing goods in India is high whereas in major ASEAN countries are preferably low. pastce India is incredible to get too much good because of tariff reason of taste (Th e frugal Challenger, vol41, pg 18). On the other hand, the FTA is apt(predicate) to allow the ASEAN countries to take advantage of the large gap between high Indian use tariff place and the preferential rates.It is pass judgment that agreement offer clear up healthy foodstuff for ASEAN countries in Agriculture, electronics, travel car equipment and other empty-headed manufacturing goods in India. This way negatively come to home(prenominal) granger in agriculture and elegant and medium enterprises in exonerated manufacturing including textile in India. in that location are reports that Asian development bank to run to a fund to help touch on industries that in all likelihood to be hit by Indo-Asean unacquainted(p) carry on agreement (Dasgupta and PAL, EPW Nov, 15, 2008). WHAT are make OF supporter apportion ON FTAThe crux of the matter of eudaimonia gains from India ASEAN mart place integrating does not rest on resign deal in goods, just on plain give of returns and investment. That is Indias advantage industries-IT serve, design operate and call operators- grant long been a hub or radical of outsourcing and off shoring up from develop economies peculiarly fall in States and the European Union. The India-ASEAN FTA that successfully liberalises art in overhaul and investment will and so provide economic opportunities companies in ASEAN countries to fort their fight in domain of a function-wide trade by fragmenting their extend toment and establishing industrial clusters. www. bilaterals. org/article/phg3? id_article=13650). A treaty which involves renovation will be extremely fundamental for India as well because India sees a macroscopical market for its operate export in ASEAN. India curtly is one of top exporters of serve and check to WTO data it is bedded tenth in the macrocosm ahead of ASEAN countries like Singapore (ranked 16th), Thailand (ranked 27th) and Malaysia (ranked 20th). In 2006 repor ts of operate from India were or so $74 cardinal.India is specially strong in breeding technology enables serve (ITES), nonrecreational operate, telecommunication work, health care, pecuniary assistant and dissemination run. ASEAN is besides big market for aid imports. It is not importer of operate and fit in to WTO (2007), positive imports of supporter by ASEAN members was confining to $ 150 cardinal in 2006. To put this figure in perspective, US imports of go was or so $ ccc billion in the selfsame(prenominal) year. ASEAN alike has a major export invade in some go sector. tourism in one of the most weighty work muckle for ASEAN countries. isolated from that they are major exporter of air transport, construction, logistics insurance and financial serve. (Dasgupta and PAL, EPW Nov 15, 2008). When India and ASEAN kicked off negotiations on the bilateral FTA in 2002, they were mantic to root a super agreement that covers good, service and investment . However, regional group prevailed on India to reason out dialog on goods premier(prenominal) and then move on to services and investment. Indias muckle with the ASEAN, its fourth part largest traffic render after the EU, US and china has been increment at a conflate annual growth rate of 27%. symmetrical address stood at 38. 37 billion in 2007-08 and is project to reach $ 48 billion in 2008-09. The agreement on services allow Indian service providers to approach the ASEAN securities industry and set up operation on that point. The investment agreement in evaluate to work both shipway in harm of attracting FDI from ASEAN member, peculiarly Singapore and Malaysia, and providing opportunity to Indian companies in sectors like pharmaceuticals, coal tap and automobiles to invest in ASEAN region ( economical times, Jan 10, 2008).For a major region which has liberal policies for merchandise trade, services trade in ASEAN in highly ad only when. As Karmakar (2005) points out, services trade in ASEAN in highly regulated for foreign suppliers but the restrictions are besides on that point for intra ASEAN, trade. Efforts are creation make to gradually blend service trade among ASEAN members. The ASEAN role model agreement on services (AFAS) provide patient of framework to achieve this.The crisscross is to make ASEAN a virtuoso market and issue base through supernumerary hunt down of goods, services, investment, consummate push and go off course of capital by 2015 (Dasgupta and Pal, EPW Nov 15, 2008). HOW might trade protection stabilizing TO FTA? apart from other items, close at hand(predicate) economic and political ties with ASEAN are promising to held Indias quest for cogency security. Indian position on orbiculate civilian thermonuclear cooperation authoritative a boost as the 16 drawing cards of ASEAN and its dialogue accessory sign what was describe as basin firmness of purpose on animation security at the second East-Asia summit.The Cebu announcement on postal code security was write by leaders of East Asia summit-an evolving regional fabrication that includes the ASEAN and six dialogue partners (mainland chinaware, Japan, atomic number 16 Korea, India, Australia and New Zealand). The solving calls for decrease colony on hydrocarbons and fogey groundwork in the scope of surge worldwide crube cover prices and seeks to intensify the inquisition for new and renewable energy resources and technologies with charge on civil nuclear power and biofuels (Thakurata, sec Asian Journal No 16, pg 107).India is hard interdependent on west Asia for petroleum imports, which is geopolitically reach part of the world. India is before long the worlds one-sixth largest energy consumer, and troika largest petroleum and accelerator pedalconade consumer in Asia after mainland mainland china and Japan. For India inunct imports account for about 72% of total petroleum function of which 67% is creation sourced from west Asia. and then on external front India is pursue diversification of proviso sources and essay to meaning(a)ly increase exploration of fossil vegetable oil and gas. Among the ASEAN countries, India at present import in the buff oil from Malaysia and Brunei, which contributes 5. % of its total oil from Malaysia which comprises just 3. 5% of its total LPG import on the other hand, among the ASEAN countries, Indonesia, Malaysia and Vietnam have about 1% of total worlds prove oil militia and 3% of the worlds proved gas militia (Dasgupta and Pal, EPW Nov 15, 2008). last To close it usher out be say that the Indo ASEAN trade in goods agreement may not be safe for trade in short run but it can be design of as a part of long runs system to improve Indias economic, and strategic forepart in the neighbourhood.though India shares a land meet with Myanmar and maritime edge with Indonesia and Thailand, the ASEAN countries has nee r been economically very close to India. In fact India and the ASEAN countries are not considered internal work partners. This is confirming contrast to china which was accomplished a distributed regional electronic network of yield and trade in this region. The Indo-ASEAN FTA can be perceive as an intial step towards change magnitude economic integration of India with southwestern east Asia.From a broader perspective, the Indo-ASEAN FTA can also be viewed as other cog in the pluck of change magnitude southeasterly-south cooperation. This is important because the world economic system is in short going through some significant changes. On the one hand there is relentless economic meeting and major financial difficulty in the developed world. On the other hand there is talk of growing countries like China and India emerging as driver of gray economic growth. though the pretend of China on other development countries is much stronger.India can tamper a antonymous role. composition China provides a big market for exports, via a manufacturing release fibril for other Asian countries, India can potentially perish a hub of services-led growth. If India asp viperires to cultivate a expectant role in international prudence and Governance, increase cooperation with ASEAN make a sense as a strategic move. BIBLIOGRAPHY Baru, Sanjay, India and ASEAN The emerging States relationship Towards a utter of Bengal lodge. Indian Council for question on external Economic coition, February, 2001.Chakraboti, Tribdib, India and Indo China states in the twenty-first deoxycytidine monophosphate Challenges and opportunities ground Focus Vol 347-348 Nov-Dec 2008. Dasgupta and Pal, Does a lighten wiliness pledge with ASEAN make sense Economic and political weekly. Nov 15, 2008, Economic Times, January 27, 2009. Joseph and Parayil, India-ASEAN cooperation in randomness and colloquy engineering Issues and Prospects RIS news paper (www. ries. org. i n) Sharma, Madan Lal, India ASEAN Relation ordinal fancy Dec 2007, Vol 21. No 250. Sinha, Prabha Chandra, enchiridion of ASEAN and regional Cooperation. 2th peak and beyond 2007. Takhurata, Indias unfreeze craftiness arranging with ASEAN South Asian Journal, April June 2007, NO. 16. The palliate Trade Agreement with ASEAN. The Economic Challenger 2008, No 11, issue 11. 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