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Comrades cry foul as India signs FTA with ASEAN

Economic Times | 14 Aug 2009

Comrades cry foul as India signs FTA with ASEAN

NEW DELHI: The government came under attack from the Opposition, particularly the Left, for “rushing into” signing the free trade agreement (FTA) with ASEAN. The Left parties said the entire issue lacked transparency as the details of the FTA are kept under wraps.

The chorus of Opposition against the FTA has been growing from Kerala in recent weeks with sections of Congress, Left and other parties raising concerns about the negative impact of the agreement on agricultural items and the plantation sector in Kerala. But the government on Thursday went ahead with the FTA with commerce and industry minister Anand Sharma signing the agreement in goods after the meeting of the ASEAN-India economic ministers in Thailand on Thursday.

“This is an agreement which will be hugely detrimental to the interests of the agriculture sector in the state. The decision by the Centre to go ahead with it without looking into the fears of Kerala is not right,” said Kerala chief minister V S Achuthanandan. Earlier this month, Mr Achuthanandan had met Prime Minister Manmohan Singh and conveyed the apprehensions of the state over the FTA. “Mr Singh had promised to give us a copy of the text of the FTA. But we haven’t received it yet,” he said.

According to earlier plans, Mr Singh was to sign the agreement with other heads of state during the Asean Summit in October. But this last minute change of plans indicates that the government did not want to take any chances with the FTA and wanted to sign it as early as possible.

Sensing trouble, the prime minister had constituted a GoM headed by finance minister Pranab Mukherjee. The GoM, which has A K Antony, Vayalar Ravi, PC Joshi and Veerappa Moily, has not met even once. The GoM was constituted after senior ministers like Mr Antony raised reservations over the agreement. Mr Antony had also taken up the issue with the Congress leadership and argued that the protests in Kerala could dent the high popular ratings of Congress.

Sources pointed out that this was the most ambitious free trade agreement ever signed by India. India has given more trade concessions to the ASEAN countries than to any other country or grouping.

The commerce ministry, however, maintained that sensitivities on agriculture had been taken on board. The plan is to liberalise trade in a phased manner on 80% of the tariff lines starting from January 1, 2010. “The agreement has provided flexibilities to India and ASEAN countries to exclude some of the products from the tariff concessions or eliminations to address their respective domestic sensitivity,” a press release said. The released added: ``India on its part has excluded 489 items from the list of tariff concessions and 590 items from the list of tariff elimination to address sensitivities in agriculture, textiles, auto, chemicals, crude and refined palm oil, coffee, tea, pepper etc.’’ ASEAN countries have been given the choice of maintaining a similar exclusion list.

Nevertheless questions continue to swirl around the government’s rush to conclude the agreement as the original plan was for Mr Singh to sign the agreement in October.

 source: Economic Times