Asean wants 600 items in free trade negative list
Economic Times | India | 13 September 2006
Asean wants 600 items in free trade negative list
NEW DELHI: Asean has come up with a composite negative list of 600 products for the proposed Indo-Asean free trade agreement. A discussion on negative lists, which has proved to be the most contentious part of the negotiations, will take place at a meeting of the trade negotiations committee later this month.
A negative or sensitive list includes products which are to be excluded from tariff reduction commitments agreed to under an FTA.
The 10-member Asean had, earlier, rejected India’s negative list of 854 items on the ground that it included a large number of products which was of interest to them.
According to official sources, now that the Asean has revealed its negative list, it would be easier for India to convince the group of India’s necessity for maintaining its negative list. Incidentally, the negative list put forward by Asean is the same list that the group maintains in its FTA with China. While India does not plan to reduce duties on all 854 items in its proposed negative list for at least five years, it has worked out a compromise deal which it feels would be acceptable to the Asean.
It has decided to divide its negative list into two. While one list including 400 items will not be open to tariff concessions at all, tariffs on the 454 items in the second list will be gradually reduced but after five years of implementation of the agreement.
Since the Asean countries, especially Malaysia and Indonesia, are most interested in palm oil (both crude and refined), tea and pepper, India has decided to give special concessions on the four agriculture products. As per the proposal, after a gap of five years, the tariff on the products would be reduced to 50% ad valorem customs duty (except for refined palm oil where the reduction would be 60% ad valorem level) over the next ten years (2022).
Similar partial and gradual tariff concessions may also be offered on other items like coffee, cinnamon, turmeric, tapioca etc. The items on the list of 400 tariff lines on which no concessions would be offered would be reviewed after five years in ’12.
