Although the ASEAN-India Free Trade Agreement has many advantages, India is concerned that the agreement will have several negative effects on the economy. As has already been said, both regions are trying to reduce their tariffs on a large portion of their traded products. This will allow them to increase market access for their products. However, it is criticized that India is not experiencing as large an increase in market access to ASEAN countries as ASEAN in India. [9] ASEAN`s economies are largely export-oriented and have high export rates to GDP (in 2007, Malaysia had a rate above 100%[10]). [11] Given the above, as well as the global financial crisis and India`s expansionary domestic market, ASEAN countries are eager to consider India as the country of origin for its exports. [11] “Of 21 sectors, the overall trade balance deteriorated in 10 to 13 sectors (reducing surpluses or increasing the deficit). Only the places where we have done better are ceramics, cement, paper, animal goods, etc. Only 10% of lines are excluded…
Wanting to catch up with other countries in Thailand or Myanmar,” he said. India and ASEAN signed the 2009 ASEAN Merchandise Trade Agreement (AITIG), paving the way for the creation of one of the world`s largest free trade zones and the ASEAN-China Free Trade Agreement. AITIG provides for a gradual reduction in tariffs and/or the elimination of products from asean and India. Framework Agreement on Comprehensive Economic Cooperation between the Republic of India and ASEAN, Bali, 8 October 2003 In 2008, the total volume of ASEAN-India trade amounted to $47.5 billion. ASEAN`s exports to India amounted to $30.1 billion , a 21.1% increase over 2007. ASEAN imports from India amounted to $17.4 billion , a 40.2 per cent increase over 2006. With regard to foreign direct investment (FDI), India`s inflow to ASEAN Member States amounted to USD 476.8 million in 2008, or 0.8% of the region`s total. India`s total direct investment in ASEAN amounted to $1.3 billion between 2000 and 2008. The trade and investment statistics of ASEAN`s dialogue partners can be accessed by www.asean.org/22122.htm.
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