Kuala Lumpur, Feb 18 (PTI) India today signed a freetrade agreement with Malaysia, second such pact within a weekwhich will give greater access to India''s services sector inthe emerging Southeast Asian nation''s market.
The pact would also enhance the current USD 9 billiontrade to USD 15 billion by 2015 as both the countries wouldslash or eliminate duties on about 90 per cent of goods tradedbetween the countries, and smoothen investment flows."Sectors such as accounting and auditing, architecture,urban planning, engineering, medical, dental, IT, managementconsultant services would get Malaysian market access,"an Indian Commerce Ministry statement said.
The India-Malaysia Comprehensive Economic CooperationAgreement (CECA) also has provisions to form joint venturesbetween the companies of both the nations in sectors such ashealthcare, telecommunications, retail and environment.
When the pact will come into force from July 1, Indianmangoes, banana, guava, cotton, motorcycles, trucks andbasmati rice will attract less duty in Malaysia, among otherthings.
As a quid pro quo, the Southeast Asian nation will faceless barriers on the sale of its fruit, engineering goods andchemicals while exporting them to India.
On Wednesday, India had signed a similar pact with Japan.
This CECA is in addition to the Free Trade Agreement(FTA) India has with ASEAN, of which Malaysia is a key member.
India and Association of Southeast Asian Nations (ASEAN)implemented the FTA in goods in January last year.
"CECA has value-added to the existing ASEAN-India tradein goods agreement by subjecting more products to tariffconcessions and advancing the timelines forreduction/elimination of tariffs," a statement from theMalaysian government said.
Apex body of Indian exporters FIEO said that there is ahuge potential to enhance trade with Malaysia as it accountsfor just 1.72 per cent of India''s trade.
Under the pact, Malaysia has also offered comparativelyhigher level of FDI in key sectors of interest to India suchas construction services (51 per cent), computer and relatedservices (100 per cent), management and consultancy services(100 per cent).
Malaysia is the third largest trading partner of Indiaamong the ASEAN.
ASEAN and India are also engaged in negotiations toinclude services and investments trade liberalisation in theirexisting FTA.
The pacts with Japan and Malaysia assume significance asthey are in line with India''s ''look east policy'', aimed atreducing its dependence on western markets for trade andinvestment.