FTA/CEPA/Trade Pacts

nrj

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Fresh from an exhilarating visit by US president Barack Obama that created much good-will on both sides, India seems keen to push its advantage as far as it will go. Talking to industry heads, India's commerce minister Anand Sharma pushed his American counterparts for starting negotiations for an India-US trade agreement, even as he announced his intention to shortly sign trade agreements with the European Union and Japan -- or a third of the world economy.

"Now, in the aftermath of President Obama's successful visit, we should consider engaging in a comprehensive economic partnership agreement (CEPA) which includes trade, investment and services," he told his American counterpart and US commerce secretary Gary Locke. Unlike the past, when the US would force free-trade agreements with developing countries like India, Locke seemed surprised by the suggestion. "I think we will take one thing at a time," he responded, when asked about Sharma's suggestion, and pointed out that US is already working with India on many multi-lateral fora.

Sharma, who inked a free trade agreement with the Association of South East Asian Nations (ASEAN), a CEPA with Korea and a preliminary agreement with Malaysia in the last twelve months, said his team has put the finishing touches on a similar agreement with Japan, the world's third largest economy. "We will sign it in a month or so. We are also at the concluding stage of a broad-based trade and investment agreement with the European Union," he added.

Sharma's aggression is in sharp contrast to the defensive approaches of earlier governments. Emboldened by India's ability to compete successfully on cost and ability with other countries -- especially in services -- the trade ministry is engaged in negotiations with dozens of countries and blocks for preferential trade agreements. One of the earliest, a free trade agreement (FTA) with Thailand, has already allowed many Indian firms to shift their manufacturing locations to the South East Asian nation. Under the FTA, a number of items -- like soaps and shampoos -- are made in Thailand and sold in India without paying import duties.

However, Sharma did not give details of the scope of the agreements he is to sign with the Japanese or EU blocks.

According to industry experts, the trade agreement with Japan is likely to improve India's access to Japanese goods including auto components, steel panels, DVD players, and agri products like Japanese yams, peaches, strawberries; with Japan improving market access to Indian generic drugs and certain agriculturaland industrial goods. On the other hand, the agreement with EU (which is India's largest trading partner), would improve access to EU banks and financial services firms, with India likely to get more openings in textiles and leather goods.

Industry body FICCI estimates trade between India and EU to touch $572 billion by 2015, if the FTA gets signed early. In comparison, India's overall foreign trade with rest of the world is only around $300 billion in goods and around $150 billion in services. Trade with Japan, currently around $10 billion, could jump double in just two years if a preferential trade agreement is signed. "FTAs would mainly do away with tariffs on goods by upto 90% or even bring tariffs to zero levels on some goods and eliminate barriers on services," says Afsar Jafri, senior research associate, Focus on Global South, a policy research institute.

Japan, an ageing economic giant which was recently displaced as the second largest economy by China, looks upon India as its ticket to regaining lost economic momentum. While tensions between Japan and China have risen due to boundary disputes and historical baggage, Japanese companies have been actively scouting for an alternative to China as a cheap manufacturing destination. Japanese firms are developing scores of new cities from the scratch along the Delhi-Mumbai industrial corridor as a special project to diversify their manufacturing base away from China.

However, Jafri points out that the deals, which will boost sectors where India is competitively stronger, will also have negative effects on other sectors. Some of these agreements, he points out, come with strings attached in the form of obligations to implement intellectual property rights, such as patents, more strictly in India. India, which has had a relatively lax intellectual property regime, is home to one of the world's largest pharma industries that specializes in out-of-patent drugs. ""The deal will impact key sectors including healthcare and agriculture. But there seems to be hardly any attempt by the government to let various stakeholders know about what the deal would like," says Jafri.

According to Bhaskar Goswami, from the Forum for Biotechnology and Food Security, the FTAs are pressing India to accede to IP provisions that can curb the rights of farmers like sharing, selling or exchanging seeds with other farmers and subject them to the economic interests of corporates. "These concerns that we have have not been addressed by the government and hence they remain."

Moreover, according to Amit Sengupta, general secretary of All India Peoples Science Network, the IP provisions pertaining to healthcare could prolong patent terms for costly innovator medicines, while making registration of low cost generic medicines difficult. "These IP provisions go beyond what India has already signed in the WTO Trips (trade related aspects of intellectual property rights )agreement. Developed countries try to get all that they couldn't get through Trips from the FTAs."

Furthermore, the reduction and removal of tariffs would imply easy access into India of 'non-new goods' as well as scrap pertaining to mining, metals etc say experts. According to Gopal Krishna, convener, environmental body Toxics Watch, FTAs will legitimise the already existing trade in waste. "Concerns are over inclusion of toxic technologies and other waste as goods or commodities like electronic goods, metal scrap for tariff reduction into FTAs."
 

nrj

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TORONTO: India will join China in filling up Canadian stores with cheaper goods once New Delhi and Ottawa sign a free trade agreement to do away with many taxes and duties.

The prime ministers of the two countries announced the start of talks for a comprehensive economic partnership agreement during their meeting on the sidelines of the G20 summit in Seoul on Friday.

The two countries aim to push their trade more than three-fold from the current $4.2 billion in the next five years. While main Canadian exports to India include machinery, fertilizers, wood pulp and vegetables, Indian exports comprise garments, metals, precious stones and jewellery, and electrical equipment.

Welcoming the decision, the Toronto Star said, "While it may take many months before the details are worked out, when it does happen Canadians can expect to see more Indian-produced products on store shelves, and perhaps cheaper prices for items already imported from the Asian country.

"The agreement should be a boon for business owners, who could open India-based offices, or simply target consumers in the country. Trade between Canada and India totals about $4 billion - the goal is to boost that to $15 billion."

A free trade agreement is expected to add about $6 billion each to the economies of the two countries.

But more than anything,Canadian banks and insurance companies will benefit immensely from a free trade pact with one of the fastest growing economies in the world. as they want access to the south Asian market.

After the global meltdown triggered by the US which is Canada's main buyer, Ottawa is trying to lessen dependence on its big neighbour by signing free trade agreements with many other nations.

Economics experts here have described the talks with India as an "important development'' for Canada.

Scotching fears that a free trade agreement will lead to more outsourcing of jobs to India, these analysts say this loss, if any, will be more than offset by Indian companies opening offices in Canada and creating jobs.

"But, with every free trade agreement comes worries that Canadians could lose jobs. We've already seen Canadian companies hiring Indian-based call centres to field customer inquires and that outsourcing could continue and even pick up.

After Canada's ban on India after its 1974 and 1998 nuclear blasts, India-Canada relations have picked up after Ottawa reversed this policy by ending India's nuclear isolation at the Nucelar Suppliers' Group in 2008.

Apart from the nuke deal signed in June, Ottawa has also inked major agreements with India in mining, science and education and other fields.
 

RAM

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Israel, India to sign free trade agreement

Last August the Indian market became second on the list of Israeli exporters' top aims. Nearly a billion dollars worth of goods were exported there in the past quarter, a 102% rise from the previous year.

A new world of opportunities is set to open up before the Israeli entrepreneur. Finance Minister Yuval Steinitz announced Thursday that Israel was set to sign a free trade agreement with India. Speaking at a trade convention in Shefayim, Steinitz said the agreement would exempt many import and export ventures from VAT in both states.
Israel currently has free trade agreements with the US, the European Union, Jordan, Egypt, and many of the Latin American states. It is the only country to have such an agreement with both the US and the EU.
The state has so far refrained from signing such agreements with China and India due to fears that the tiny market would become swamped with cheap goods. But recent complaints by entrepreneurs that the Western market was unresponsive, due to the economic crisis and other issues, caused the Finance Ministry to reconsider.
Steinitz is set to visit India in February in order to sign the agreement, which does not require government approval.
"The giant Indian market is full of endless opportunities for Israeli companies, of which many are already active there and can now expand their market," Steinitz said.

Officials at the Finance Ministry added that the abundance of cheap goods that will most likely flood the Israeli market were "the agreement's downside", but that the advantages outweigh its weaknesses.
http://www.ynetnews.com/articles/0,7340,L-3989862,00.html
 

Tshering22

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This is old news isn't it? Kamal Nath last year was in Israel and had announced something like this if I remember it right. Great news though. Israeli hi tech equipment comes here and after sometime our companies for JVs even in civil field. High tech, reasonable cost = win win for both.
 

pmaitra

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This is very good news. India should have such agreements with strategically friendly countries. I think India should also seek such kinds of agreements with CIS countries and South American countries. India should also move closer to VISA free travel agreements with a select few countries.

Overall, a good news.
 

Rage

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This is old news isn't it? Kamal Nath last year was in Israel and had announced something like this if I remember it right. Great news though. Israeli hi tech equipment comes here and after sometime our companies for JVs even in civil field. High tech, reasonable cost = win win for both.
It is old news. But the media likes the 'novelty'.

Kamal Nath was in Israel earlier this year and negotiations were on to conclude the deal. But an FTA is extensive and needs lots of creases to be ironed out, particularly with respect to our diamond industry, which currently dominates commodities trade with Israel. So, in a way, I'm glad they took their time.
 

Yusuf

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Ok i need to get on and find out how i can do business with israelis. I wish we get an FTA with taiwan.
 
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EU-India FTA by March 2011

http://www.hindustantimes.com/EU-India-FTA-by-March-2011/Article1-636536.aspx

Negotiations between India and the European Union (EU) for a Free Trade Agreement (FTA) are on track and expected to be concluded by March-April 2010, said government sources. In the last few days, some contentious issues such as transit rights for Indian-origin generic drugs through European


ports have been resolved, the source said. EU will amend its customs regulations to this effect and the decision is likely to be announced during the India-EU summit on 10th December.
Prime Minister Manmohan Singh is in Brussels to attend the summit.

Seizure of Indian generic drug during transit in European ports where the particular product may still be patent-protected has become a serious pinprick in trade relations between India and EU.

Union commerce minister Anand Sharma and his EU counterpart will present a status report on the ongoing negotiations. The delay in concluding the negotiations – the FTA was to be signed during the summit – has been caused by the financial crisis that hit Europe this year.

Finding common ground on the intellectual property related issues remain a bugbear in the negotiations as both sides, their respective civil societies and NGOs have strong views on it, said the sources. However, it has been agreed that India will not have any TRIPS-plus intellectual property commitments. "The FTA will be compliant with existing domestic laws and international agreements already entered into as far as IPR is concerned," the source said.

Movement of people – another contentious issue given the implication it will have on domestic employment in Europe – is back on the agenda and a breakthrough is possible, said the source. Agriculture is the other sector that still remains contested over questions such as public procurement.
 
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India to sign free trade deals with Japan, Malaysia in Feb

http://www.reuters.com/article/idUSWNAS045520110114

http://www.indianexpress.com/news/Trade-pacts-with-Japan--Malaysia-in-February/737700

Launching the 'India Show 2011 today, Commerce and Industry Minister Anand Sharma said India will sign two major market-opening pacts with Japan and Malaysia in February. The government recently concluded negotiations for a Comprehensive Economic Partnership Agreement (CEPA) with Japan and a Comprehensive Economic Cooperation Agreement (CECA) with Malaysia.

"We will be signing the pacts in the next few weeks, in February for sure. The proposed free-trade agreement in services, a key area of interest for India, and investments with the 10-member Association of South East Asian Nations (ASEAN) is expected to be finalised by March," Sharma said. "What we are seeking is to reach an early conclusion on an agreement in trade in services by March, that is the mandate."

The 'India Show 2011', a three-day business fair and India symposium organized by the Confederation of Indian Industry (CII), India Brand Equity Foundation and the India High Commission in Singapore, has drawn a record participation of around 90 exhibitors from India. A wide range of Indian innovations right from Tata Nano to the spices, fabrics and wines of India were showcased at the fair.

Singapore Trade and Industry Minister Lim Hng Kiang said that Singaporean companies are keen to explore opportunities in India.

"Singapore too has much to offer to Indian companies who are keen to gain foothold in Asia. Indian companies with operation in the region can centralise their functions in Singapore to plan and carry out a range of key business activities including investment planning and coordination, financial control and treasury functions and market development," Lim said. "Indian companies can also use Singapore as a launch pad for trading and investment activities in the region."
 

JayATL

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very interesting- can't wait to hear details on the agreement. good move India on these two nations. Japan trade a lot with china and has shown keen interest in making India no 1 market to trade with vs china, especially after the recent anti- japan demonstrations in china and border disputes where china is trying to be the typical bully. Capitalize on this...
 

DeletedUser

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very interesting- can't wait to hear details on the agreement. good move India on these two nations. Japan trade a lot with china and has shown keen interest in making India no 1 market to trade with vs china, especially after the recent anti- japan demonstrations in china and border disputes where china is trying to be the typical bully. Capitalize on this...
Yeah I agree with you. The less dependent we get on China, the better off we are. First off, it would decrease their income and secondly, it would allow them less leverage in case of a conflict. I think Japan and Malaysia realise this as does India of course. I can see the ASEAN countries becoming stronger allies of India if China continues to behave like it is currently doing.
 
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http://www.bernama.com.my/bernama/v5/newsindex.php?id=558462

http://netindian.in/news/2011/01/21/00010258/india-eu-fta-likely-be-ready-april-daniele-smadja

India-EU FTA likely to be ready by April

The Free Trade Agreement (FTA) between India and the European Union (EU) is likely to be concluded by April, EU Ambassador Daniele Smadja said here yesterday.

The agreement will, however, not be signed before the next India-EU Summit to be held here as some technical details are still being worked out.

"The main agreement is expected to be firmed up by April... But we do not expect the agreement to be signed then. We will have to wait till the next Summit," Ms Smadja told journalists here.

Agreeing that there would have to be some "give and take" in the agreement, she said in an agreement both parties would have to tell something to their constituencies back home. She did not elaborate.

Both sides have some differences on the issue of life-saving drugs and geneticaly-modified crops.

She, however, said the FTA would provide a comfort level to both sides as it would cover temporary mobility of professionals and cross-border supply of services.
 

Tshering22

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Ok i need to get on and find out how i can do business with israelis. I wish we get an FTA with taiwan.
I don't think that would be possible. We do anything with ROC, we got to stop doing it with PRC. That's the condition that Chinese government has kept. Forget free trade agreement.
 
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http://www.thehindubusinessline.com/blnus/03231210.htm

Comprehensive FTA with Japan likely on Feb 16


NEW DELHI: India and Japan are likely to sign an ambitious bilateral market opening pact to enhance their $10.4 billion trade on February 16.

The country is also likely to sign Comprehensive Economic Cooperation Agreement (CECA) with Malaysia on February 17 or 18, a commerce ministry official said.

Both the agreements are aimed at reducing or eliminating tariffs on over 90 per cent of the goods traded between the countries.

"The Commerce and Industry Minister, Mr Anand Sharma will travel to Tokyo and is expected to sign the pact on February 16. After that he will go to Kuala Lumpur," the official said.

The agreement with Japan, is expected to come into force from April, the official added.

Indian exporters from the sector like cotton, textile, ready made garments and marine products will be benefited more, while Japanese exporters would gain in areas such as electronics, project imports and transport equipment, the official added.

Negotiations on the CEPA with Japan, was concluded during Prime Minister, Mr Manmohan Singh's visit to Tokyo in October 2010. - PTI
 
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http://www.sify.com/news/india-australia-to-start-talks-on-fta-soon-news-national-lbys4gdjjia.html

India, Australia to start talks on FTA soon

Mumbai, Jan 24 (IANS) India and Australia will soon start negotiations on a free trade agreement (FTA) aimed to strengthen bilateral economic relations, Commerce and Industry Minister Anand Sharma said Monday.

'An FTA with Australia has the potential to enhance trade in goods, services and investment between the two countries,' Sharma said after meeting his Australian counterpart Craig Emerson here.

Sharma said he would start formal discussions on the proposed free trade agreement with Australia after the World Economic Forum to be held Jan 26-30.

During their meeting held on the sidelines of the Partnership Summit here, the two ministers also emphasised the need for early conclusion of the Doha round of WTO trade talks. 'They have agreed that 2011 is critical to take these negotiations to a logical conclusion,' a commerce ministry statement said.

India's bilateral trade with Australia was $13.8 billion in 2009-10. The balance of trade is heavily in favour of Australia, with India's exports to Australia just $1.4 billion while its imports are $12.4 billion.

India's imports from Australia largely consist of gold, coking coal, copper ores, petroleum and LNG, alumina and wool, while India's exports to Australia are mainly IT and IT-enabled services.
 

Rahul92

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Japan and India sign free-trade deal

Japan and India have signed a free-trade agreement that will see tariffs on 94% of goods scrapped within a decade.

It will focus on the textile, drug, auto and services sectors, and comes as trade between the two is sliding.

Bilateral trade fell 23% to $10bn (£6.2bn) in 2009, the Japan External Trade Organization said.



India and Japan represent the fast-growing new and stagnating old guard of the global economy

In a separate report, the World Trade Organization said more open markets will help boost Japan's growth.

New vs Old

On Monday, Japan was overtaken by China as the world's second-largest economy and it is keen to boost trade to help offset sluggish domestic demand.

India on the other hand is one of the world's fastest-growing economies and is looking for new markets for its companies' products.

Japan's Foreign Minister Seiji Maehara and India's Commerce Minister Anand Sharma inked the trade deal in Tokyo.

According to the World Trade Organization while Japan's governments have taken steps to boost economic growth, they need to do more where trade is concerned.

"While looser macroeconomic policies have helped Japan's economy to recover from the global financial crisis, they do not address its long-standing structural problems," the WTO said in trade policy review of Japan.

"These problems can be addressed more effectively by far-reaching structural reforms, of which trade liberalization (and the resulting stimulus to competition) is an integral part," it added.

Infrastructure Fund

In another attempt to boost ties between the two Japan is mulling plans to finance some of India's infrastructure projects.

India's commerce minister has proposed setting up a $9bn fund that would help further develop the Delhi-Mumbai industrial corridor.

The project started in 2007 and is based on a similar project between Tokyo and Osaka. It is being funded in part by the Japanese government and Japanese companies.

When finished it will include a high-speed rail freight network, three new sea ports and six airports.

It is expected to attract investment of more than $100bn.



http://www.bbc.co.uk/news/business-12477156
 

ejazr

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GCC-India FTA 'on right track'

NEW DELHI: India and the Gulf states are moving in the right direction to conclude a free trade agreement (FTA) for boosting comprehensive economic cooperation between the two sides, a Saudi official said in New Delhi on Friday.

"The pact covering goods, services and investment sectors will take economic ties between India and the GCC (Gulf Cooperation Council) nations to a higher level," said Abdulrahman Al-Rabeeah, chairman of the Saudi-Indian Business Council.

He was addressing an interactive meeting of a 33-member business delegation from Saudi Arabia at the Associated Chambers of Commerce and Industry of India (ASSOCHAM).

Al-Rabeeah said businesses have to take the lead and work with the government. "Investment and business opportunities from India in the areas of education, IT, tourism, health care, biotechnology, telecommunications and automobiles and components should be explored," he added.

While the India-GCC FTA is expected to open a billion-strong consumer market for the Gulf countries, it will also benefit India substantially as the six-member bloc controls over 45 percent of the world's recoverable oil wealth and 20 percent of gas resources. The bloc also accounts for about a fifth of the global crude output.

The free trade deal, which will remove restrictive duties and push down tariffs on goods trading, is expected to provide Indian pharmaceutical and chemical industries a boost in their presence in the Gulf region.

Items having export potential from India to GCC countries include food products, pharmaceuticals, machinery and transport equipment, ceramic products, apparels and clothing, cotton and woven fabrics, plastic and rubber products, essential oils, perfumery and cosmetics besides iron and steel articles.

On his part, Saudi Ambassador Faisal Hassan Ahmed Trad urged Indian companies to increase investment in the Gulf nation. He pointed out that a framework agreement for the FTA has already been signed.

The potential sectors for investments by Indian entrepreneurs include information technology, software development, telecommunications, education, training and health care services, tourism and hotel industry, banking and financial services, oil, gas and petrochemicals, electricity, housing, road and rail network.

Reciprocating the Saudi gesture, ASSOCHAM Secretary-General D.S. Rawat said the Indian trade chamber will lead a 30-member delegation to Saudi Arabia in early May.

Two-way trade between India and the GCC could exceed $130 billion by 2013-14, up from $100 billion in 2009-10, said an official. While India-Saudi bilateral trade stood at to $21 billion in 2009-10, India's exports to the Gulf nation rose to $3.90 billion in 2009-10.

Separately, New Delhi-based Intercontinental Consultants and Technocrats signed a consulting agreement with Alrabiah Consulting and Engineering Services at the meeting.

Indian Prime Minister Manmohan Singh visited Saudi Arabia in February 2010, the first by an Indian leader in 28 years. About a dozen political and economic deals were signed at the time.

Saudi Arabia pumped in FDI worth $31.5 million between April 2000 and August 2010 into the Indian economy. The main sectors that attracted the investments were electrical equipment, food processing, automobile, computer software and hardware, and telecommunications.
 
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http://www.business-standard.com/india/news/bangladesh-to-sign-ftaindia-this-year/127691/on

Bangladesh to sign FTA with India this year


Bangladesh hopes to sign a free trade agreement with India this year, its Commerce Secretary Md Ghulam Hussain said here.

"We have agreed that the FTA will be good for both the countries," he said after addressing a Singapore seminar on investment in Bangladesh.

FTA documents have been exchanged and negotiations were underway, he said but declined to give a specific timeframe for signing the FTA.

Bangladesh is also negotiating FTAs with Saudi Arabia, Kuwait, Pakistan, Sri Lanka and Malaysia, he said.

Speaking at the business seminar, Hussain highlighted Dhaka government's pro-business approach and called for investments in ports, power and infrastructure sector.

Public Private Partnership will be encouraged, he said.

Diplomatic observers see strong potential for business and investments in Bangladesh through the FTAs but said that the political differences among South Asian countries are delaying such trade collaborations and cooperations.
 

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