Mumbai: Starting tomorrow, the government will reduce or altogether abolish tariffs on 555 products as part of a free-trade agreement with Singapore, information and broadcasting minister P R Dasmunsi said.
He said the cabinet at its meeting last night gave its approval for tariff elimination/reduction on 555 products through a protocol of amendment of India-Singapore Comprehensive Economic Cooperation Agreement.
As Singapore is a member country of the Association of Southeast Asian nations (ASEAN), any subsequent improvement made at the time of an ASEAN-India Free Trade Agreement in terms of product coverage timeline, rules of origin would be offered to Singapore with appropriate amendments, he said.
"The tariff concessions would further enhance growth in bilateral trade with economic benefits to both countries," he said.
The India-ASEAN free trade agreement has been bogged down by lack of agreement on just five agriculture products - tea, coffee, pepper, crude palm oil and refined palm oil. All other issues were sorted out at the India-ASEAN trade ministers'''' meeting in Singapore last week.
Malaysia and Indonesia want India to drastically lower import duties on palm oil as it is their biggest export to India.
India says it is willing to reduce bound tariff to no less than 45 per cent on these products by 2018. However, policymakers have already reduced duties on palm oil to 40 per cent in order to increase domestic supply of cooking oil and to quell food inflation.