India will continue to do more to make it easier to do business in the country while remaining one of the most open economies to trade and investment, Indian envoy to Singapore Jawed Ashraf has said.
India will continue to do more to make it easier to do business in the country while remaining one of the most open economies to trade and investment, Indian envoy to Singapore Jawed Ashraf has said. Responding to a question on whether protectionism was on the rise in India and India was retreating from Free Trade Agreements (FTAs) at the ASEAN-India Business Forum, he reiterated, “we are open and will continue to be more and more easy to do business.”
“Openness should not be conflated with FTAs. India’s openness and embrace of the global economy is evident,” he said at the forum attended by some 500 delegates from the regional business community here yesterday. “In terms of investment flows, we are perhaps some of the most open economies in the world,” he said, pointing out that 90 per cent of the investments into India are placed on the automatic route and now Foreign Investment Promotion Board had been dismantled to make it even easier and smoother.
Ashraf told the forum “trading with India has become easier. There are virtually no restrictions on trade. Tariff have come down dramatically and are at a competitively low levels.” “The sensitive list or those that have certain kind of restrictions have been shrinking very rapidly, taking into account security issues or international obligations,” Ashraf said. He reaffirmed the Indian government’s daily focus on improving infrastructure and logistics and introduce trade facilitation measures, which are important for trade.
Negotiations on FTAs should not be confused with degree of openness, he said, explaining the differences between partnership and a bilateral or multi-lateral free trade agreements. FTAs, he said, are deviations from or in addition to World Trade Organisation (WTO) arrangements, and represent negotiations on exchange of benefits between two sides.
He noted that unwarranted concerns are being raised about India’s position on Regional Comprehensive Economic Partnership (RCEP) agreement between the 10 member countries of ASEAN and six partner countries including India. “Our position is very simple. When we call it a Regional Comprehensive Economic Partnership agreement, it must be comprehensive. It can’t only be focused on goods. We should also be looking at services. That is India’s competitive strength.
“Indeed, services and services or knowledge-linked manufacturing is really the economy of the future,” which are based on give-and-take options, he said. In his address to the forum, Singapore’s Trade and Industry Minister, S Iswaran said a number of Asian markets have proven to be bright sports for business.
“Southeast Asia and India, in particular, are experiencing strong economic growth driven by growing consumption and infrastructure developments,” he said. “India’s consumer market is expected to become the fifth largest in the world by 2025. Similarly, the number of middle-class households in Southeast Asia will double between now and 2025,” he said.
“These are the markets that we need to engage, and Singapore is in a good position to partner both the regions in their growth,” Iswaran stressed. Supporting Singapore’s central position, he also highlighted Singapore’s airline connections with daily flights to key cities in India and Southeast Asia.
In addition to being a financial hub, Singapore also shares historical and cultural ties, as well as valuable people-to-people ties with India and Southeast Asia, he said. Delegates and speakers at the forum discussed a wide range of opportunities between India and the ASEAN – the Association of Southeast Asian Nations – which becomes combined markets of USD 4.5 trillion and powerful emergence of consumers from 1.9 billion population of the two regions.
Growth in these two regions (India and ASEAN) is led by strong economic fundamentals, ample natural and human resources, as well as regional trends, rising foreign direct investment, urbanisation and increasingly affluent middle- class consumers, said International Enterprise Singapore, a trade promotion agency which organised the forum.
“In India, consumption is projected to grow four-fold by 2025, to reach $1.06 trillion in values. This will propel India’s consumer market to become the fifth largest in the world by 2025,” the agency said.