Author: Vani Archana, ICRIER

India has recently signed a free trade area (FTA) agreement with the ASEAN nations (Brunei, Singapore, Cambodia, Indonesia, Malaysia, Laos, Myanmar, the Philippines, Vietnam and Thailand). The agreement allows for the reduction of tariffs on so-called highly sensitive items, and special products including palm oil, pepper, coffee and black tea by 2019. Tariff rates on sensitive items with the five ASEAN member states most important to India’s trade system will be reduced gradually until 2016. Tariff rates on Normal Track 1 items will be reduced, and finally eliminated, by 2013, and by 2016 for Normal Track 2 items. Other countries in ASEAN like Cambodia and Myanmar receive three to five years longer to achieve the same tariff goals. There is also an exclusion list, which will be reviewed every year.

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