The government Thursday said it expects trade between India and the 10-member Association of Southeast Asian Nations (ASEAN) to reach $100 billion by 2015 and further double by 2022, under the free trade agreement (FTA) signed between India and ASEAN in 2009.
"Because of the FTA, trade between ASEAN and India has reached about $80 billion. We hope by 2015 it will touch $100 billion and get doubled by 2022. So, there is lot of work, there is a lot of scope," minister of state for commerce and industry Nirmala Sitharaman said.
Speaking at the second edition of India-CLMV (Cambodia, Laos, Myanmar and Vietnam) business conclave being held in New Delhi, Sitharaman pointed out that skill development, agricultural products, manufacturing, project exports, and energy among others were key sectors which hold potential for trade and investment between the two sides.
According to the minister, current trade is concentrated in only a few items and there was tremendous scope to deepen and widen the basket.
"Currently, 70-80 per cent of India-CLMV trade is centred on only a few products. I think there is a scope to expand the basket and bring in more commodities and manufactured goods into it," Sitharaman said.
She said that India's 'Look East' policy has now been transformed into "Act East".
India signed a Free Trade Agreement (FTA) on goods with ASEAN in 2009, and since then trade between ASEAN and India has steady grown, reaching about $80 billion level now. And, with the comprehensive treaty covering services and investment also in place by July next year, this should move higher, the minister said.
Even as ''India's Look East Policy has become very sharp focused,'' she felt there was a need of ''greater and accelerated engagement across the globe with East Asia.'' The minister stressed that India is very keen to open up the north-east part of the country to greater economic activity, improve on its connectivity with the rest of the East and therefore look at India's North-East as threshold to our ''Act East'' policy.
The minister said India's engagement with the CLMV countries is based on the three pillars of ''commerce, culture and connectivity''.
Currently, 70-80 per cent of India-CLMV trade is centered around a few products. ''I think there is a scope to expand the basket and bring in more commodities and manufactured goods into it,'' she said, adding, ''the Government of India has accorded high priority to economic engagements with the four countries, and is working towards establishing seamless physical connectivity with the region.''
Robust physical connectivity through road, rail and sea links will enable businesses on both sides to leverage the opportunities created by the India-ASEAN FTA in goods.
The FTA in services and investment will come into force with effect from 1 July 2015.
''Seamless connectivity will spur people-to-people contacts and tourism, create new enterprises and millions of jobs for people in the region, especially when the economic corridors along the India-CLMV road and rail lines would be completely and fully developed,'' the minister said.
Commerce secretary Rajeev Kher said India's trade with the CLMV region stood at $13 billion in 2013-14. Much of that trade, he observed, was with Vietnam. He felt there was tremendous scope to expand trade relations with the other countries in the region.
Kher highlighted the need to establish regional and sub-regional value chains in order to maintain and sustain long-term economic relationship with the region.
He said Indian industry could partner with businesses in the CLMV countries to reach out to newer markets.