Bangkok, Aug.13 (ANI): India on Thursday signed the ASEAN-India Free Trade Agreement in Goods following the meeting of the ASEAN-India Economic Ministers held in Bangkok.
Union Minister of Commerce and Industry Anand Sharma and ASEAN Economic Ministers signed the pact on trade in goods under the Comprehensive Economic Cooperation Agreement (CECA).
Sharma described the free trade pact as "well balanced" and said it "is in harmony with the India's Look East Policy."
The signing of the trade pact holds significance as it will break duty barriers in the 1.7 billion consumer market in the region.
As part of the Comprehensive Economic Cooperation Agreement, the Trade in Goods Agreement will integrate the two globally important economic blocks for mutually beneficial economic gains.
ASEAN is a major trading partner for India and accounts for about 10 per cent of its global trade.
In the last financial year, bilateral trade between India and ASEAN was more than 40 billion dollars.
India and ASEAN have set an ambitious target of achieving bilateral trade of US 50 billion dollars by 2010. The current Agreement which comes into force from 1st January 2010 would help achieve this target.
The Trade in Goods agreement focuses on tariff liberalization on mutually agreed tariff lines from both the sides and is targeted to eliminate tariffs on 80 per cent of the tariff lines accounting for 75 per cent of the trade in a gradual manner starting from 1st January, 2010.
The Agreement has provided flexibilities to India and ASEAN countries to exclude some of the products from the tariff concessions or eliminations to address their respective domestic sensitivity.
The exchange of tariff concessions between India and the ASEAN Member Countries would lead to growth in bilateral trade and investment resulting in economic benefits to India and the ASEAN Member Countries.
Indian exporters of Machinery and machine parts, Steel and steel products, agriculture products such as Oilcake, Wheat and Buffalo Meat, Auto Components, Chemicals and Synthetic Textiles would gain additional market access as a result of tariff liberalisation by ASEAN.
Indian manufacturers would also be able to source products at competitive prices from the ASEAN countries.
The Agreement also provides for bilateral safeguard mechanisms to address sudden surge in imports after the Agreement comes into force.
The signing of the pact could be possible following over six years of intense negotiations.
The first phase of implementation is expected to be over by January 1, 2010. (ANI)