8-Oct-2021: Shri Piyush Goyal calls called upon the ASEAN bloc to do away with Non-Tariff Barriers
The Union Minister of Commerce & Industry, Consumer Affairs & Food & Public Distribution and Textiles, Shri Piyush Goyal has called upon the ASEAN bloc to do away with Non-Tariff Barriers (NTBs). Addressing the “Special Plenary with the Trade Ministers of the Region: Indo-ASEAN Business”, organised by the CII, Shri Goyal also called for “curbing the misuse of Free Trade Agreements (FTAs) by third parties, often outside the ASEAN Region.”
“It is unfortunate that in the recent past we had to deal with several restrictive barriers on our exports to the ASEAN region, particularly in the Agriculture & Auto sector. I think these only result in reciprocal action from other countries including from India, and will hurt the long term desire of our leaders to expand trade between the two countries,” said Shri Goyal, in his address through video conference.
Shri Goyal also called upon the ASEAN Bloc to allow reciprocal FTA concessions to imports from India to correct the skewed trade imbalance in favour of the ASEAN.
“India has currently been witnessing exponential growth in imports from the ASEAN Region while our exports have been impeded by non-reciprocity in FTA concessions, NTBs, import regulations, quotas & export taxes from ASEAN countries. Such a review will enable alignment with contemporary trade practices, procedures & regulatory harmonization,” said Shri Goyal.
“Current trade of about $80 Billion makes Indo-ASEAN region one the largest trading areas globally. Despite increasing trade we are short of the target of $200 bn, which India & ASEAN were to achieve by 2022,” he added.
Shri Goyal reiterated the importance for fair, equitable, transparent, reciprocal and inclusive trade rather than enhancing trade through tariff reductions.
“Let me also underscore that if we were to review the ASEAN-India Trade In Goods Agreement (AITIGA), it may truly promote trade on both sides, support industry and manufacturing on both sides and help us support each other to truly become modern, progressive economies,” he said.
This year marks the 25th Anniversary of India-ASEAN partnership. India’s bilateral trade with ASEAN has grown steadily. India’s merchandise exports to ASEAN increased from $ 23 bn in 2010 to $ 30 bn in 2020. While India’s imports from ASEAN have surged from $ 30 bn in 2010 to $ 44 bn in 2020.
Shri Goyal said, under the leadership of the Prime Minister Narendra Modi, India’s “Look East” policy has transformed into “Act East” policy. In the 17th India-ASEAN Summit, on 12th November, 2020, PM Modi had announced contribution to the ASEAN COVID-19 Response Fund.
“During COVID-19 pandemic, India has shown its capacity and its capability to the entire world. We not only met all our international service commitments but also became self-sufficient in production of critical medical supplies including PPEs,” he said.
Shri Goyal said India is known as the “Pharmacy of the World” by providing Medicines & Vaccines to all. India will give ASEAN nations full cooperation in generic drugs and vaccine manufacturing to meet their demands. To be Aatmanirbhar, India has announced PLI scheme for supporting critical Bulk Drugs & APIs worth nearly a billion dollars, Pharma Drugs ($ 2 bn) & Medical devices ($ 456 Mn).
“We are implementing one of the biggest vaccination drive anywhere in the world, having crossed 930 million vaccine doses so far, soon going to (reach) the 1 billion mark. We expect that in the next few weeks India will have a fully vaccinated adult population and probably in another 3-4 months we would be fully double dose vaccinated across the length and breadth of the country for all willing adults. Our one day record has exceeded 23 million vaccines,” he said.
Shri Goyal said a prosperous ASEAN is central to India’s Vision for Indo-Pacific region with Security And Growth for All in the Region (SAGAR).
“With a combined population of 2.1 billion, India & ASEAN countries are home to rapidly growing markets with immense opportunities. By combining our strengths, we can rewrite and make a golden chapter of progress and prosperity for the 30 percent of the world population that reside in ASEAN countries and India,” he said.
27-Aug-2020: Cooperation, Collaboration and Commitment will guide the strategic partnership between India and ASEAN countries, says Shri Piyush Goyal
Commerce and Industry Minister Shri Piyush Goyal today said that 3Cs- Cooperation, Collaboration and Commitment, will guide the strategic partnership between India and ASEAN countries. Addressing the ASEAN-India Business Council virtual meet, Shri Goyal said the Covid-19 pandemic period provided a unique opportunity to India to demonstrate itself as the trusted partner to the world, particularly in times of stress. Shri Goyal extended a hand of friendship to the ASEAN region, which he described as deep and valuable partners, and partners in the progress.
The Minister said that Aatmanirbhar Bharat connotes a self-reliant country which is ready to engage with the world from the position of strength and confidence, and on equal and fair terms. He said that India and ASEAN have not been able to harness the full trade potential, for various reasons, but now is the time to open matrix to expand trade, address concerns of all nations and businesses, and resolve the differences. He extended India’s friendship and partnership to ASEAN through businesses, so that together both the partners are able to succeed, secure future, work together, attain prosperity, and achieve a target of $300 billion trade. Shri Goyal said that the business council meeting is a good forum to discuss concerns and best practices, share ideas, and flag the problems.
Shri Goyal said that during the early days of pandemic, India went out to the world for its requirements to fight Covid-19, but didn’t get much traction, as everyone was holding on for their own requirements. But, India, on the other hand, with the ability to provide medicines, acted as the Pharmacy for the world. We supplied medicines to over 150 countries of the world, to every part of the world, particularly to the less developed nations. Restrictions were imposed initially but that was with the noble intent of ensuring that the poor nations are not deprived of the medicines. All this showed that India is a resilient country, a trusted partner and a friend indeed.
Shri Goyal said that the country developed adequate capacity to manufacture PPE, masks, and ramped up our testing capabilities from under 1000 per day to about a million a day. “We have been self-sufficient under the leadership of the Prime Minister Shri Narendra Modi. During the period, Indians developed commitment and consciousness to maintain social distancing, to adequately take care of personal hygiene, wear a mask at all times and care for near ones.”, the Minister said. He said that India demonstrated its resilience, ability to overcome problems and our collective efforts ensured that we can protect lives and livelihoods. We enforced strictest lockdown to save lives, and then ensured quick un-lockdown to bring take care of the livelihood issues, he added.
13-Nov-2019: India failed to benefit from free trade agreements with ASEAN
India failed to benefit from free trade agreements (FTAs) with the Association of South East Asian Nations (ASEAN). In fact, India’s trade deficit had increased ever since the country entered into FTAs with ASEAN.
ASEAN compromises 10 countries including Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. India had signed an FTA in goods with the regional bloc in 2009, known as the ASEAN–India Free Trade Agreement (AIFTA). In 2014, an FTA in services was also included. India had also signed the Comprehensive Economic Cooperation Agreement with various countries of ASEAN.
India’s imports from ASEAN countries increased sharply in comparison to its exports to them after signing these agreements. India’s exports to ASEAN countries amounted to $23 billion in 2010, which increased to $36 billion in 2018, with a compound annual growth rate of five per cent. At the same time, India’s imports from these countries increased from $30 billion in 2010 to $57 billion, a growth of eight per cent. On the other hand, India’s imports and exports with ASEAN countries increased 22 per cent, from 2001 to 2009. Its exports increased from $3 billion to $18 billion while imports increased from $4 billion to $24 billion.
India’s past experience with FTAs has not been encouraging. India had recorded a trade deficit in all major trade agreements other than the South Asia Free Trade Agreement (SAFTA).
SAFTA was signed in 2006 between Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka. Since its inception, India’s exports to these countries increased from $4 billion to $21 billion. In contrast, India has been at the receiving end of the ASEAN Comprehensive Economic Cooperation Agreement, which it joined in 2010. India’s total trade deficit with ASEAN increased from $8 billion in 2009-10 to about $22 billion in 2018-19.
The share of ASEAN in India’s total trade deficit increased from about 7 per cent to 12 per cent during the same period. The country has also bled in its Comprehensive Economic Partnership Agreement with South Korea, where its deficit increased from $5 billion in 2009-10 to $12 billion 2018-19. Similar is the story with the India-Japan FTA named CEPA, which became effective from August 1, 2011.
Among the 15 RCEP countries, India faces trade deficits with all except Laos, Cambodia, Myanmar and the Philippines. China, the biggest fear for India, accounts for 60 per cent of the total deficit.
After the 2010 FTA with ASEAN countries, India’s imports from the bloc rose by 79 per cent while exports grew by just 39 per cent.
India’s net exports to countries without a trade agreement were only marginally lower than its net exports to countries with FTAs. In contrast, the imports from countries with trade agreements were substantially higher, pushing India into a trade deficit.
India should not consider entering into FTAs without preparing the agriculture and manufacturing sectors adequately. All successful countries, especially our East Asian neighbours, have turned their enterprises into global players. These countries adopted the right mix of policies that have paid rich dividends. China has been promoting its domestic industry for the past several decades.
An increasing number of countries are now focused on making their domestic economies resilient by taking a step back from process of globalisation.
10-Sep-2019: India, ASEAN agrees to review FTA in goods
India and 10-member bloc of South-East Asian nations have agreed to review their free trade agreement (FTA), signed in 2009, to make it more business-friendly and boost economic ties. The two sides also decided to constitute a joint committee for this purpose. This was agreed upon during the meeting between economic ministers of ASEAN and Commerce Minister Piyush Goyal in Bangkok on 10 September 2019. They met for the 16th AEM-India consultations.
The ministers agreed to initiate the review of the ASEAN-India trade in goods agreement to make it more user-friendly, simple, and trade facilitative for businesses. The ministers tasked officials to work on the details of the review of the agreement and submit an update rather next ministerial meet.
Both the sides also gained the recommendations of the ASEAN-India business council to further promote the potential of bilateral trade through the utilisation of the free trade pact as well as cooperation in some areas like financial technology, connectivity, startups and innovation.
The India-ASEAN trade in goods pact came into force from January 2010. Under the pact, two trading partners set timelines for eliminating duties on the maximum number of goods traded between the two regions. The 10 ASEAN members are Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam.
The bilateral trade between the two sides has increased to USD 80.8 billion in 2018 from USD 73.6 billion in 2017.
Background: ASEAN was established on 8 August 1967 in Bangkok by the five original member countries: Indonesia, Malaysia, Philippines, Singapore, and Thailand. Brunei Darussalam joined on 8 January 1984, Vietnam on 28 July 1995, Laos and Myanmar on 23 July 1997, and Cambodia on 30 April 1999. The ASEAN Declaration states that the aims and purposes of the Association are: (1) to accelerate the economic growth, social progress and cultural development in the region through joint endeavors in the spirit of equality and partnership in order to strengthen the foundation for a prosperous and peaceful community of Southeast Asian nations. To promote regional peace and stability through abiding respect for justice and the rule of law in the relationship among countries in the region and adherence to the principles of the United Nations Charter. In 1995, the ASEAN Heads of State and Government re-affirmed that “Cooperative peace and shared prosperity shall be the fundamental goals of ASEAN.
India- ASEAN Relations
The Association of South-East Asian Nations (ASEAN) comprises of Indonesia, Singapore, Philippines, Malaysia, Brunei, Thailand, Cambodia, Lao PDR, Myanmar and Vietnam. India’s focus on a strengthened and multi-faceted relationship with ASEAN is an outcome of the significant changes in the world’s political and economic scenario since the early 1990s and India’s own march towards economic liberalisation. India’s search for economic space resulted in the ‘Look East Policy’. The Look East Policy has today matured into a dynamic and action oriented ‘Act East Policy. PM at the 12th ASEAN India Summit and the 9th East Asia Summit held in Nay Pyi Taw, Myanmar, in November, 2014, formally enunciated the Act East Policy.
Apart from ASEAN, India has taken other policy initiatives in the region that involve some members of ASEAN like BIMSTEC, MGC etc. India is also an active participant in several regional forums like the Asia-Europe Meeting (ASEM), East Asia Summit (EAS), ASEAN Regional Forum (ARF), ASEAN Defence Ministers' Meeting + (ADMM+) and Expanded ASEAN Maritime Forum (EAMF).
India's relationship with ASEAN is a key pillar of our foreign policy and the foundation of our Act East Policy. The up-gradation of the relationship into a Strategic Partnership in 2012 was a natural progression to the ground covered since India became a Sectoral Partner of the ASEAN in 1992, Dialogue Partner in 1996 and Summit Level Partner in 2002. There are, in total, 30 Dialogue Mechanisms between India and ASEAN, cutting across various sectors.
Mission to ASEAN: India has set up a separate Mission to ASEAN and the EAS in Jakarta in April 2015 with a dedicated Ambassador to strengthen engagement with ASEAN and ASEAN-centric processes.
25th Anniversary of ASEAN-India Dialogue Relations India and ASEAN observed 25 years of their Dialogue Partnership, 15 years of Summit Level interaction and 5 years of Strategic Partnership throughout 2017 by undertaking a wide range of over 60 commemorative activities, both in India and through our Missions in ASEAN Member States, which culminated in the ASEAN-India Commemorative Summit on the theme "Shared Values, Common Destiny” on 25 January 2018 in New Delhi. The commemorative activities included an ASEAN-India Regional Diaspora event in Singapore, a Youth Summit, a Music Festival, an Artists’ Retreat, Port calls by Indian Naval Ships, a Workshop on Blue Economy, a Connectivity Summit, a meeting to reinforce our Network of Think Tanks, a Dharma-Dhamma Conference, a Hackathon and Startup Festival, a Global SME Summit, a Business and Investment Meet and Expo, a Textiles Event, an ICT Expo, a Business Council Meeting, a Ramayana Festival, a Film Festival and the inauguration of an India-ASEAN Friendship Park in the heart of our national capital, New Delhi. The astonishing variety and breadth of these activities laid a firm foundation for an enduring partnership for the future.
At the ASEAN-India Commemorative Summit, PM and the ASEAN Leaders jointly adopted the Delhi Declaration and decided to identify Cooperation in the Maritime Domain as the key area of cooperation under the ASEAN-India strategic partnership.
In an unprecedented gesture, the Leaders of ASEAN countries also graced the 69th Republic Day Parade as India's Guest of Honour. It was a proud moment for India to host the Leaders of all ten ASEAN countries at the Summit, within a short span of five years.
In 2012, ASEAN and India had commemorated 20 years of dialogue partnership and 10 years of Summit level partnership with ASEAN with a Commemorative Summit held in New Delhi under the theme 'ASEAN-India Partnership for Peace and Shared Prosperity' on 20-21 December 2012. The Commemorative Summit attended by the Leaders from all the 10 ASEAN countries endorsed elevating the partnership to a 'Strategic Partnership'. The Leaders also adopted the 'ASEAN-India Vision Statement'.
Plans of Action: As a reflection of the interest of ASEAN and India to intensify their engagement, the ASEAN-India Partnership for Peace, Progress and Shared Prosperity, which sets out the roadmap for long-term ASEAN-India engagement, was signed at the 3rd ASEAN-India Summit in 2004 in Vientiane. A Plan of Action (POA) for the period 2004-2010 was also developed to implement the Partnership. The 3rd POA (2016-20) was adopted by the ASEAN-India Foreign Ministers Meeting held in August 2015. Furthermore, ASEAN and India have identified priority areas for the period of 2016-2018 and are already implementing activities under it, which would contribute towards successful implementation of the 2016-2020 Plan of Action.
Political Security Cooperation: Faced with growing traditional and non-traditional challenges, politico-security cooperation is a key and an emerging pillar of our relationship. Rising export of terror, growing radicalization through ideology of hatred, and spread of extreme violence define the landscape of common security threats to our societies. Our partnership with ASEAN seeks to craft a response that relies on coordination, cooperation and sharing of experiences at multiple levels.
ASEAN, as a regional grouping based on consensus, has worked tirelessly over 50 years to help secure peace, progress and prosperity in the region. India, therefore, places ASEAN at the centre of its Indo-Pacific vision of Security and Growth for All in the Region.
The main forum for ASEAN security dialogue is the ASEAN Regional Forum (ARF). India has been attending annual meetings of this forum since 1996 and has actively participated in its various activities. The ASEAN Defence Ministers' Meeting (ADMM) is the highest defence consultative and cooperative mechanism in ASEAN. The ADMM+ brings together Defence Ministers from the 10 ASEAN nations plus Australia, China, India, Japan, New Zealand, Republic of Korea, Russia, and the United States on a biannual basis.
Economic Cooperation: India-ASEAN trade and investment relations have been growing steadily, with ASEAN being India's fourth largest trading partner. India's trade with ASEAN stands at US$ 81.33 billion, which is approx. 10.6% of India's overall trade. India's export to ASEAN stand at 11.28% of our total exports.
Investment flows are also substantial both ways, with ASEAN accounting for approximately 18.28% of investment flows into India since 2000. FDI inflows into India from ASEAN between April 2000 to March 2018 was about US$68.91 billion, while FDI outflows from India to ASEAN countries, from April 2007 to March 2015, as per data maintained by DEA, was about US$38.672 billion. The ASEAN-India Free Trade Area has been completed with the entering into force of the ASEAN-India Agreements on Trade in Service and Investments on 1 July 2015.
ASEAN and India have been also working on enhancing private sector engagement. ASEAN India-Business Council (AIBC) was set up in March 2003 in Kuala Lumpur as a forum to bring key private sector players from India and the ASEAN countries on a single platform for business networking and sharing of ideas.
Socio-Cultural Cooperation: We have been organizing a large number of programmes to boost People-to-People Interaction with ASEAN, such as inviting ASEAN students to India each year for the Students Exchange Programme, Special Training Course for ASEAN diplomats, Exchange of Parliamentarians, Participation of ASEAN students in the National Children’s Science Congress, ASEAN-India Network of Think Tanks, ASEAN-India Eminent Persons Lecture Series, etc.
The 2nd edition of the ASEAN-India Workshop on Blue Economy, jointly hosted with the Socialist Republic of Viet Nam, was held on 18 July 2018 in New Delhi.
Connectivity: ASEAN-India connectivity is a priority for India as also the ASEAN countries. In 2013, India became the third dialogue partner of ASEAN to initiate an ASEAN Connectivity Coordinating Committee-India Meeting. While India has made considerable progress in implementing the India-Myanmar-Thailand Trilateral Highway and the Kaladan Multimodal Project, issues related to increasing the maritime and air connectivity between ASEAN and India and transforming the corridors of connectivity into economic corridors are under discussion. A possible extension to India-Myanmar-Thailand Trilateral Highway to Cambodia, Lao PDR and Viet Nam is also under consideration. A consensus on finalising the proposed protocol of the India-Myanmar-Thailand Motor Vehicle Agreement (IMT MVA) has been reached. This agreement will have a critical role in realizing seamless movement of passenger, personal and cargo vehicles along roads linking India, Myanmar and Thailand. PM announced a Line of Credit of US$ 1 billion to promote projects that support physical and digital connectivity between India and ASEAN and a Project Development Fund with a corpus of INR 500 crores to develop manufacturing hubs in CLMV countries at the 13th ASEAN India Summit held in Malaysia in November 2015.
Funds: ASEAN Multilateral Division offers project-based financial assistance to ASEAN countries. Financial assistance has been provided to ASEAN countries from the following Funds:
ASEAN-India Cooperation Fund: At the 7th ASEAN-India Summit in 2009, India announced a contribution of US$ 50 million to the ASEAN-India Fund, to support implementation of the ASEAN-India Plans of Action, which envisage cooperation in a range of sectors as well as capacity building programmes in the political, economic and socio-cultural spheres for deepening and intensifying ASEAN-India cooperation. Projects worth approx. In order to take the development and capacity building initiatives forward, PM has proposed enhancing the ASEAN-India Fund with an additional grant of US$ 50 million at the 14th ASEAN India Summit in Vientiane in September 2016.
ASEAN-India S&T Development Fund (AISTDF): At the 6th ASEAN-India Summit in November 2007 in Singapore, India announced the setting up of an ASEAN-India Science & Technology Development Fund with a US$ 1 million contribution from India to promote joint collaborative R&D research projects in Science & Technology. This Fund become operational in 2009-10 and expenditure began to be incurred from FY 2010-11. This fund has been enhanced to US$5 million from 2016-17.
ASEAN-India Green Fund: At the 6th ASEAN-India Summit on 21 November 2007 in Singapore, India announced the setting up of an ASEAN-India Green Fund with an initial contribution of US$ 5 million from India, to support collaboration activities relating to environment and climate change. Some of the areas identified for collaboration under the Fund are climate change, energy efficiency, clean technologies, renewable energy, biodiversity conservation and environmental education.
ASEAN-India Projects: India has been cooperating with ASEAN by way of implementation of various projects in the fields of Agriculture, Science & Technology, Space, Environment & Climate Change, Human Resource Development, Capacity Building, New and Renewable Energy, Tourism, People-to-People contacts and Connectivity etc.
Some of the prominent projects, which are either ongoing or in the final stages of approval are as follows:
Space Project envisaging establishment of a Tracking, Data Reception/Data Processing Station in Ho Chi Minh City, Vietnam and upgradation of Telemetry Tracking and Command Station in Biak, Indonesia; Setting up of Centres of Excellence in Software Development & Training in CLMV countries; e-Network for provision of tele-medicine and tele-education in CLMV countries, Quick Impact Projects in CLMV etc.
Apart from the above projects, India has been supporting ASEAN, especially CLMV countries under the Initiatives for ASEAN Integration, which include projects on Training of English Language for Law Enforcement Officers in CLMV countries and Training of professionals dealing with capital markets in CLMV by National Institute of Securities Management Mumbai, scholarships for ASEAN students for higher education at Nalanda University, Training of ASEAN Civil Servants in drought management, disaster risk management, sustainable ground water management etc. To boost People-to-people Interaction with ASEAN, India has been organising various programmes including Training Programme for ASEAN diplomats, Exchange of Parliamentarians, Participation of ASEAN students in the National Children’s Science Congress, ASEAN-India Network of Think Tanks, ASEAN-India Eminent Persons Lecture Series, ASEAN-India Students Exchange programme, ASEAN-India Media Exchange programme etc.
In Agriculture, we are cooperating with ASEAN by way of projects such as Exchange of Farmers, ASEAN-India Fellowships for Higher Agricultural Education in India and ASEAN, Exchange of Agriculture Scientists, Empowerment of Women through Cooperatives, Training Course on Organic Certification for Fruits and Vegetables etc. These were further strengthened at the 4th ASEAN-India Ministerial Meeting on Agriculture held in January 2018 in New Delhi, with the endorsement of the Medium Term Plan of Action for ASEAN-India Cooperation in Agriculture and Forestry for 2016–2020. In the S&T field, we have projects such as ASEAN-India S&T Digital Library, ASEAN-India Virtual Institute for Intellectual Property, ASEAN-India Collaborative Project on S&T for Combating Malaria, ASEAN-India Programme on Quality Systems in Manufacturing, ASEAN-India Collaborative R&D Project on Mariculture, Bio-mining and Bioremediation Technologies etc.
Delhi Dialogue: India has an annual Track 1.5 event Delhi Dialogue, for discussing politico-security and economic issues between ASEAN and India. Since 2009, India has hosted ten editions of this flagship Conference. The 10th edition of Delhi Dialogue was hosted by the MEA on 19-20 July 2018 in New Delhi, with the theme, "Strengthening India-ASEAN Maritime Advantage".
ASEAN-India Centre (AIC): At the Commemorative Summit held in 2012, the Heads of the Government recommended establishment of ASEAN-India Centre (AIC) to undertake policy research, advocacy and networking activities with organizations and think-tanks in India and ASEAN, with the aim to promote the ASEAN-India Strategic Partnership. Set up in 2013, the AIC has been serving as a resource centre for ASEAN Member States and India, for strengthening ASEAN-India strategic partnership and promoting India-ASEAN dialogue and cooperation in the areas of mutual interests. AIC has provided inputs to policy makers in India and ASEAN on implementation of ASEAN-India connectivity initiatives by organising seminars, roundtables etc. AIC also organizes workshops, seminars and conferences on various issues relevant to ASEAN-India strategic partnership. It undertakes regular networking activities with relevant public/private agencies, organizations and think-tanks in India and ASEAN and EAS countries, with the aim of providing up-to-date information, data resources and sustained interaction, for promoting ASEAN-India Strategic Partnership.