More than seven years after India signed the Comprehensive Economic Cooperation Agreement (CECA) with Singapore, the latter’s share in India’s total trade has not picked up. The India-Singapore CECA came into existence in August 2005 and, from 2007-08 to 2011-12, Singapore?s share in India’s total trade has actually declined from 3.74% to 3.2%.
The decrease in share is despite the trade (export and imports) between India and the city state growing close to 20% annually, which indicates higher growth in New Delhi’s trade with many other countries, especially those with which the base is relatively higher.
In 2011-12, India’s trade with Singapore stood at $25.4 billion compared with $16.9 billion in 2010-11. The balance of trade was in favour of India at $8.2 billion- the highest in the last five years.
?We don’t have a strong free-trade agreement (FTA) with Singapore and the number of products excluded is large. Singapore had low customs duty when the CECA was implemented and the FTA did not give a big boost to our exports,? said Abhijit Das, head and professor, Centre For WTO Studies at Indian Institute of Foreign Trade.
In trade in goods, India’s offer was categorised under four lists ? the early harvest programme where the customs duty would be eliminated immediately on the entry into force of CECA (506 lines), the phased elimination (2,202 lines) and phased reduction (2,407 lines) where the tariffs would be eliminated or reduced in a phased manner up to 2009 and the negative list (6,551 lines) where no concessions were offered.
The CECA is an integrated package comprising trade in goods and services, an agreement on investments, mutual recognition agreements in conformity assessment of standards in goods, mutual recognition agreement in services and cooperation agreements in customs, science and technology, education, e-commerce, intellectual property and media.
?We used to import petroleum products from Singapore worth $3 billion till a few years back, but now our companies have developed their own capacities due to which India exports these products to Singapore. Hence, our exports have risen though the imports have been falling,? said Ajay Sahai, director general and CEO, Federation of Indian Export Organisations.
After the CECA with Singapore, India signed similar agreements with Malaysia in 2011 and Asean in 2009, besides comprehensive economic partnership agreements (CEPA) with Japan in 2011 and South Korea in 2010.
?It is also a reflection of the global downturn that our trade has not picked up with Singapore,? Das added.
