A successful conclusion of a trade deal between India and the nations of Southeast Asia would overcome the challenges of global trade amid increasing trade tensions and protectionism, Indian commerce minister Suresh Prabhu said on February 21.
He spoke at the inaugural session of the India-ASEAN (Association of Southeast Asian Nations) Expo and Summit 2019, held in New Delhi.
The Regional Comprehensive Economic Partnership, or RCEP, is an ambitious trade agreement being negotiated between the 10 ASEAN countries and their six free trade partners: Australia, China, India, Japan, New Zealand and South Korea. ASEAN members are Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam.
RCEP would create the world’s largest free trade bloc comprising 3.5 billion people and constituting 30 percent of the world’s GDP, 30 percent of global trade and 26 percent of global foreign direct investment flows.
“India is constructively engaged in RCEP negotiations and the country believes that ASEAN will remain central to the economic integration of the Indo-Pacific region through RCEP,” Prabhu said.
The expo attracted more than 200 exhibitors from India and the 10 ASEAN countries, including established companies, young entrepreneurs and startups as well as business associations and councils.
Sandeep Somany, president of Indian ceramic company FICCI, said he strongly supports mega trade agreements, especially at a time of trade protectionism.
Akhil Bansal, deputy CEO of KPMG in India, agreed, saying harmonization, convergence and removal of barriers are the keys to trade growth and economic development.
ASEAN Secretary-General Lim Jock Hoi said amid the current trade tensions and political instability the importance of free trade is immense, especially when ASEAN already ranks among the world’s top 10 investment destinations.
He advocated that the trilateral highway, which is under construction to connect India with Myanmar and Thailand by road, be extended to Cambodia, Laos and Vietnam as well.
Lee Chuan Teck, second permanent secretary of Singapore’s Ministry of Trade and Industry, told attendees at the summit that barrier-free trade is the way forward. Special thrusts need to be given on connectivity－land, sea and air, he said.
“This will really deepen people-to-people and business-to-business connect, resulting in a win-win situation for businesses as well as travelers,” he said, adding that special efforts must also be made toward strengthening transport infrastructure in the region, for that will lower costs of logistics which will in turn make companies a lot competitive.
For ASEAN representatives, the focus next shifts to Siem Reap, Cambodia, where the ASEAN trade ministers will gather for the 7th RCEP Inter-Sessional Ministerial Meeting on March 2-3.
India’s Junior Minister for Commerce Chhotu Ram Chaudhary said India has relaxed several laws and regulations under its Make in India initiative to attract investments.
He said India was using the India-ASEAN Expo & Summit 2019 to “invite the visiting ministers and business leaders to be part of the country’s growth narrative”.
Two-way trade volume between the India and ASEAN climbed to $73.6 billion in 2017 and plans for growth by 2022 would more than double the amount as they are among the fastest growing economies of the world.
Investments opportunities in areas such as medical devices, pharmaceuticals, aviation, fisheries, infrastructure, food processing and ship-building are enormous, Chaudhary said.