Yesterday the Indo- Asean FTA was signed.
Let us see how bilateral trade will fare ! It is bound to shoot up.
We feel that Kerala’s fears will be unfounded, as India gets access to ASEAN
markets. India is leading in IT, BT, NT and other services. India will
capture the ASEAN market and bilateral trade will be to India’s advantage !
Even though ASEAN countries have more yield and more productivity, India
will compete in all fields. India will become the third largest economy in
the world, according to a Goldman Sachs report, based on GDP growth !
The ten member countries of ASEAN – Malaysia, Indonesia, Singapore,
Philippines, Brunei, Thailand, Vietnam, Cambodia, Laos, Myanmar – exported
goods worth $864 b and imported $ 774 billion. India gets access to a one
trillion dollar ASEAN economy !
The pact has been welcomed by industry lobbies. The CII welcomed the move,
saying it will give India access to ASEAN markets. ASSOCHAM said that the
bilateral trade will go to a whopping $60 billion in the near future.
FICCI said that the pact will open up new market opportunities for Indian
business with zero tariffs on 80% of ASEAN imports within four years.
Indian PM Dr Singh had called a group of ministers to allay domestic fears
before signing the pact. 489 items were kept out of the ambit of the pact.
The positiive stance of Jupiter, in India’s Seventh House, is responsible
for this move. India’s exports ( and imports ) are bound to rise !
According to a Kerala Report, a new challenge has propped up. India has to
improve her competitive efficiency to meet this new challenge. It is to be
noted that exports to ASEAN are only $14 b, whereas imports are $20 b. A
deficit of $ 6 b. Challenges are more; achievements may be less !
Cash crops, rice, fish, crude oil, electronics, auto accessories etc are all
ASEAN exports to India. India exports wheat, oilseeds, pharmaceuticals,
organic chemicals, ornaments and refined oil. China has tenfold India’s grab
of the ASEAN market. S Korea, New Zealand, Japan and Australia have signed
pacts with ASEAN. Even though it is a free trade pact, India faces a
formidable challenge !
In 07-08, India had a deficit of $14.56 billion. This is 15% of Indian total
deficit. Indian trade deficit is increasing !