India ASEAN FTASaleem Ahmed

BheemiahRavi BharatiaShahi Sultan

Fahad AhmedArthur Denzlin

Charan RajSaipooja AmarAfzal Hussain

Participating countries in ASEAN

Free Trade Aggrement

• Free trade area is a type of trade bloc, a designated group of countries that have agreed to eliminate tariffs, quotas and preferences on most (if not all)goods and services traded between them. It can be considered the second stage of economic integration. Countries choose this kind of economic integration form if their economical structures are complementary. If they are competitive, they will choose customs union.

• A Free Trade Agreement in goods was signed between India and the Association of South East Asian Nations, in Bangkok on August 13th, 2009. Implementation is to start from January 2010.

• The FTA was effective from January 1, 2010. The FTA would eliminate tariffs for about 4000 products (which include electronics, chemicals, machinery and textiles) out of which duties for 3200 products will be reduced by December 2013, while duties on the remaining 800 products will be brought down to zero or near zero levels by December 2016

• The 489 items excluded from the list of tariff concessions and 590 items excluded from the list of tariff eliminations in the agreement pertain to farm products, automobiles, certain auto-parts, machinery, chemicals, and crude and textile products. Tariff cuts in respect of some sensitive items like palm oil, tea, coffee and pepper will be graduated during a period of 10 years

Highly Sensitivity List

Benefits to the exportors of

• Machinery• Steel• oilcake,• Wheat• buffalo meat• auto components• synthetic textiles• refined petroleum products• organic chemicals• Pharmaceuticals• gems and jewellery

Factor China

• China - it already has a head-start over India as it has an existing FTA with ASEAN. The Rules of Origin (ROO) have been diluted to 35%. This means that ASEAN members can add 35% value to products imported from non-ASEAN countries and sell it in India. On the other hand, India's FTAs with ASEAN members like Thailand and Singapore have ROO pegged at 40%. In fact, even the China-ASEAN FTA has a 40% ROO standard.

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