Aso bats for EPA with India
21 October 2008
Tokyo (PTI): India and Japan have made "substantative progress" in their negotiations on the proposed Economic Partnership Agreement (EPA), says Prime Minister Taro Aso but the pact is unlikely to be signed during Prime Minister Manmohan Singh’s visit to Tokyo.
Aso said the planned agreement will become the "trigger" for expanding bilateral economic ties.
"EPA is one of the most important issues. I would like EPA to become the trigger for further development of the economic relations between Japan and India, Aso said. "In order to do so, EPA needs to be of a high quality and beneficial to both countries."
"We have seen substantive progress in our EPA negotiations and I am looking forward to discuss this matter with Prime Minister Singh, based on the negotiations the two countries have had so far," Aso told PTI in an e-mail interview ahead of Singh’s official visit from Oct 21 to 23.
India and Japan have been negotiating a EPA for the last two years with an objective of giving a boost to the USD 10 billion bilateral trade by way of eliminating and slashing duties on as much as 90 per cent of the goods and services traded between the Asian countries.
While the trade negotiators have completed several rounds of discussions, they have not been able to reach a complete agreement. Both the sides have areas of concern that include the rules that will govern the value added third country goods, quality standards and the negative areas to be shielded from the breaking of the tariff wall.
Describing the Indian market as "quite huge," Aso said it has been growing at an astonishing pace in recent times. "The Japanese companies are keenly watching its development."
It is only natural that Japan and India, the largest and the 3rd largest economies respectively in Asia, should further deepen their economic ties, Aso said.
"We cannot say, however, that the size of their economic relations is large enough considering the size of their economies."
In 2007, for example, India is Japan’s 27th largest trade partner, and the share of Japan’s trade with India in its total foreign trade is merely 0.8 per cent, he pointed out.
"We should, therefore, try to enhance drastically the economic relations between Japan and India through all means, and we have many bilateral economic co-operation on the agenda during Prime Minister Singhs visit, Aso said.
Ahead of Singh’s visit, industry body FICCI had also sought immediate tariff elimination by Japan on products of export interest to India.
Japan has high tariffs on items like leather, textiles, marine and chemical products, the chamber said. Although Japan has zero duty on around 30 per cent of its chemical and pharmaceutical products, its stringent approval and product registration act as a barrier to Indian exports.