Cargo ships are moored at a port in Singapore (Photo: AFP/VNA) New Delhi (VNA) - The government is reviewing the continuation of the free trade agreement (FTA) with ASEAN in the wake of the trading bloc’s reluctance to address India’s concerns over what it believes are asymmetries in the trade pact during the last ten years.
According to Times of India, the country’s main grouse is the rising trade deficit with the 10–country bloc.
The Indian government is looking to revamp its strategy on FTAs with Finance Minister Nirmala Sitharaman on July 31 hinting that New Delhi will demand "reciprocal" agreements with countries where it is open to the market.
The Narendra Modi government has blamed the trade agreements worked out by the United Progressive Alliance (UPA) for a large part of the problem of trade deficit, arguing that the agreements with ASEAN, the Republic of Korea and Japan were signed in haste and India’s interests were not adequately protected.
As a result, Minister of Commerce and Industry Piyush Goyal has been demanding renegotiation of certain provisions under a review mechanism, something that ASEAN has so far refused to accept.
At least three high-ranking officials in the administration said that the government was looking at the option of exiting some of the FTAs, especially the one with ASEAN, if the terms of engagement were not in India’s favour.
In recent years, starting with the threat to block a WTO agreement on trade facilitation in 2015 to walking out of negotiations on the Regional Comprehensive Economic Partnership (RCEP), India has hardened its stance in global engagements.
Sitharaman, Goyal and Bibek Debroy, who heads the Economic Advisory Council to PM, are looking at the options to strengthen India’s trade engagements and a review of existing FTAs./.
VNA
