M A I N   N E W S

Buzzwords: Open skies, roads, trade
Rajeev Sharma
Tribune News Service

Cebu (Philippines), January 14
Open skies, open roads and free trade are the new buzzwords that are going to redefine India’s relations with the 10-nation ASEAN grouping and take these already vibrant ties to a new level.

And a new strong undercurrent is developing between India and the Association of South East Asian (ASEAN) countries that is expected to act as the strongest catalyst in Indo-ASEAN relations: Bollywood. That Bollywood has of late been emerging as Brand India’s newest and most effective ambassador is not a secret. What came as a surprise, however, was a persistent plea made by Malaysia today, pitching for joint production and direction of Hindi films. At the day-long fifth India-ASEAN summit here today, Prime Minister Manmohan Singh announced that India would now be willing to engage ASEAN authorities in a discussion on an “open skies” policy. At the last India-ASEAN summit, the Prime Minister of Singapore had stressed the need for such a policy, particularly after the success of the 2003 initiative to liberalise air services between India and ASEAN.

“Open skies” policy will be complemented by a similar policy on road linkages between India and ASEAN which is going to make New Delhi-to-Hanoi (and beyond) rail and road link a reality sooner than expected. New Delhi is already engaged in a significant manner with Myanmar, India’s gateway to ASEAN region.

Another very important highlight is that India today finalised principles on which it will arrive at a cast iron Free Trade Agreement (FTA) with ASEAN by July 2007. Both sides today agreed in principle to keep a negative list not exceeding five per cent of their bilateral trade. On the rest 95 per cent, there will be highly sensitive list of items on which tariff reduction will be more graded.

The growing India-ASEAN relations, a direct result of India’s 16-year-old “Look East” policy, are amply demonstrated in their increasing economic interaction. India’s trade with ASEAN has risen from $ 2.4 billion in 1990, to $ 23 billion in 2005.

India’s trade with the countries of the East Asia Summit has, similarly, risen from $ 8 billion in 1990, to $ 67.6 billion in 2005. This accounts for nearly 30 per cent of our external trade. At the same time, the period has also seen an increase in FDI flows, both from India to the region and from the region into India.

Prime Minister Manmohan Singh, in his address at the India-ASEAN summit, today announced New Delhi’s intent to deepen its economic integration by entering into Free Trade or Comprehensive Economic Partnership Agreements, both with ASEAN as a whole and with individual countries of the region. Such agreements are already under different stages of discussion or implementation with Singapore, Thailand, Malaysia and Indonesia. “This web of mutually beneficial partnerships can, we believe, be brought together in a Pan Asian FTA that could light up the future of this region,” the Prime Minister said. He pointed out that India today was very different from the India of 1991.

“It is now a vibrant market-place. Our entrepreneurs are aggressively investing overseas. India has also emerged as a productive and profitable investment destination. We have a $ 700 billion economy that is growing at 7 - 8 per cent every year. In the first half of the current year, economic growth reached 9.1per cent,” Dr Manmohan Singh said while talking about today’s India.