PM calls for early conclusion of Trade Liberalisation talks

However, some against negotiations as Philippines, Indonesia don't agree

As talks with European Union and ASEAN over liberalising trade faces hiccups, Prime Minister Manmohan Singh today called for early conclusion of these negotiations.

A senior official said the Prime Minister told the concerned officials and ministers at a meeting of the Trade & Economic Relations Committee (TERC) to try and conclude free trade agreement (FTA) with European Union and Comprehensive Economic Cooperation Agreement (CECA) with ASEAN.

However, some of the committee members wanted talks with ASEAN to be suspended since Philippines and Indonesia are not inclined over CECA with ASEAN. FTA is agreement on goods and CECA includes all -- goods, services and investments.

TERC is an institutional mechanism for evolving the extent, scope and operational parameters of economic relations with other countries in a coordinated and synchronized manner.
 
Chaired by the Prime Minister, the committee comprises Finance Minister P Chidambram, Commerce & Industry Minister Anand Sharma, External Affairs Minister Salman Khurshid, Deputy Chairman, Planning Commission Montek Singh Ahluwalia, Chairman, Economic Advisory Council C Rangarajan among others.

India and European Union have not been able to reach consensus on the agreement, negotiations on which started in June 2007.  

The negotiations for a free trade agreement, officially described as Bilateral Trade and Investment Agreement (BTIA), have missed several deadlines.

India has been seeking a single visa for its professionals on short-term contractual visits to the European Union. On the other hand, the 27-nation bloc has been asking for significant reduction in customs duty on cars,wines and spirits on their exports to India. 

The two sides also have differences on inclusion of intellectual property rights (IPR) and data security in the agreement. The EU wants India to commit on IPR over and above the WTO obligations.    

India and its largest trading partner EU aim to slash duties on over 90 per cent of the trade under the pact.     

The two-way trade between India and EU increased to USD 110.26 billion in 2011 from USD 83.37 billion in 2010.

India and ASEAN have been negotiating to expand their FTA to CECA, but the Philippines and Indonesia are not inclined.

As such, the meeting also deliberated on the option of suspending negotiations on both services and investment and resume at a later date.

However, the Prime Minister wanted that these negotiations be continued and concluded at earliest.

India's trade with ASEAN is growing with a compounded annual growth rate of 42 per cent over the last two years. Exports to ASEAN have doubled from 18 billion dollars in 2009-10 to over 36 billion dollars in 2-11-12, while imports grew by 28 per cent from 25.7 billion dollars to 42.5 billion dollars.