A meeting with ASEAN countries in February to review the 13-year-old FTA

Mumbai: The thirteen-year-old Free Trade Agreement (FTA) with the Association of Southeast Asian Nations (ASEAN), signed in August 2009 and effective since 2010, will be reviewed in February. India intends to insist on modernizing the agreement.

A delegation of Asian countries is expected to visit India in February. The ten-member ASEAN also includes Dar es Salaam, Thailand, Malaysia, Vietnam, Singapore, the Philippines, Indonesia, Cambodia, Laos and Myanmar.

Every provision of the existing FTA will be reviewed afresh. These provisions are thirteen years old and there is a need to renew the agreement now that foreign trade has undergone sweeping changes, said an official of India's commerce ministry.

Imports of laptops, IT hardware, telecom equipment, stainless steel products etc. from ASEAN countries to India have increased. Sources of the Ministry of Commerce said that there has been an increase in the import of these goods since the last 6 months. There is an increase in imports from countries like Thailand, Malaysia, Vietnam, Singapore. The balance of trade under the agreement has so far been in favor of ASEAN.

In addition to the increase in trade deficit, the government is concerned by reports of goods being smuggled into India from non-ASEAN countries as well as through ASEAN countries.

Keeping this fact in mind, the government is insisting on Rules of Origin under the existing FTA.

India's exports to ASEAN in financial year 2023 increased to $44 billion from $42.32 billion in financial year 2022, but against this, imports increased from $68 billion to $87.57 billion, resulting in a trade deficit with these countries from $26.76 billion. It had increased to 43.57 billion dollars.