ASEAN and Japan FTA under Review
· Study Finds FTA Utilization in Korea for Steel, Plastics for Singapore and Malaysia for Auto Parts
An internal assessment of India’s bilateral Free Trade Agreements (FTAs) or Preferential Trade Agreements (PTAs) with Sri Lanka, Afghanistan, Thailand, Singapore, Japan, Bhutan, Nepal, Republic of Korea and Malaysia reveals that the cumulative average growth rate (CAGR) in trade with these partners over the last 5 financial years was 7.1%. While there has been growth rate in both imports from and exports to these FTA partners, the utilization rate of FTAs both for India and its partners has been moderate. The economic impact assessment of FTAs is a continuous process which is undertaken both in terms of data analysis and stakeholder consultations. An analysis of preferential import data for some of these agreements indicates that the FTA utilization rates have been moderate to high in the case of some sectors like iron and steel for the India Korea Comprehensive Economic Partnership Agreement (CEPA) and India Japan CEPA. Plastics in the case of India Singapore Comprehensive Economic Cooperation Agreement (CECA) and auto-motives in the case of India Malaysia CECA.
The review of the trade agreements is undertaken on the basis of mutual consent of the trading partners and demand from domestic stakeholders. Two reviews of the India Singapore CECA have been completed. The India-Bhutan Agreement on Trade Commerce and Transit was renewed in 2016 while the India-Nepal Treaty of Trade was extended in 2016. Eight rounds of negotiations have been completed for the review of the India Korea CEPA which commenced in 2016. Moreover, India has taken up the review of India Japan CEPA and India ASEAN FTA with its trading partners.
This information was given by the Minister of Commerce and Industry, Piyush Goyal, in a written reply to the Rajya Sabha on 20 March 2020.