New Delhi, In a significant development, a delegation from the Association of Southeast Asian Nations (ASEAN), consisting of around 50 members including high-ranking officials, is scheduled to visit New Delhi from February 17 for a three-day discussion. The primary agenda of the visit is the reevaluation of the free trade agreement (FTA) between India and ASEAN, with a particular focus on the ASEAN Trade in Goods Agreement (ATIGA), in effect for over a decade.
The review aims to address contemporary trade challenges by potentially expanding the range of goods and services covered under non-tariff barriers. Emphasizing the need for modernization, an anonymous source stated, “There is also a need to modernise the ATIGA, which has been signed over a decade ago.”
Quarterly negotiations between Indian and ASEAN officials have been established to facilitate the conclusion of the review by 2025. The update will particularly concentrate on refining the Rules of Origin (ROO) to enhance the overall efficiency of the agreement, an essential aspect in determining the national origin of products in international trade.
India’s trade deficit with ASEAN has witnessed a significant rise, increasing from $7.5 billion annually when the agreement was initiated to approximately $44 billion in FY23. This fiscal year, India exported goods worth $44 billion to the region, while imports amounted to $87.57 billion.
The ASEAN delegation’s visit aligns with India’s Look East policy, reflecting the government’s commitment to restructuring trade and investment relations with ASEAN economies. Analysts underscore the importance of addressing market access issues in goods and services trade equitably, considering the potential influence of these economies on global trade flows.
As the review unfolds, stakeholders anticipate a strategic realignment of economic ties between India and ASEAN, ensuring resilience in common supply chain frameworks and addressing concerns related to trade accords.