Lok Sabha Question No. 2492 (UNSTARRED), answered on 2017-07-31
Subject: Free Trade Agreements
Ministry: COMMERCE AND INDUSTRY
Asked by: KURUPPASSERY VARKEY THOMAS, RAJU ALIAS DEVAPPA ANNA SHETTI, M. B. RAJESH

## GOVERNMENT OF INDIA

## MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA UNSTARRED QUESTION NO. 2492 TO BE ANSWERED ON 31 st JULY, 2017

## FREE TRADE AGREEMENTS

## 2492.   PROF. K.V. THOMAS: SHRI RAJU SHETTY: SHRI M.B. RAJESH:

Will the Minister of COMMERCE & INDUSTRY ( वािणÏय एवं उɮयोग मंत्री ) be pleased to state:

- (a) the details of Free Trade Agreements (FTAs) signed/proposed to be signed by India with  other  countries  including  those  signed  or  proposed  to  be  signed  with  Asian countries/Eurasian Economic Union along with their present status;
- (b) whether the Government has assessed the impact of these FTAs on steel, agriculture and domestic industries and if so, the details thereof along with their benefits/ net inflow  of  foreign  investment  and  the  steps  taken/  being  taken  to  protect  the agricultural sector from the negative effect of FTAs;
- (c) the  details  of  the  export  and  import  made  by  India  with  those  countries  it  has entered  into  FTAs/Extensive  Economic  Participation  Agreement  during  the  last three years, region/ quantity/Price-wise; and
- (d) whether the  Government is in  talks  with  many  foreign  countries  including  Israel, West Asia and African countries to sign new FTA agreements and if so, the norms being followed and the action plan formulated and priority areas identified in this regard  along  with  the  progress  made  with  regard  to  implementation  of  these agreements, country-wise?

## ANSWER

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## THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (INDEPENDENT CHARGE) (SMT. NIRMALA SITHARAMAN)

- (a) :  The  details  of  the  Free  Trade  Agreements  (FTAs)/Comprehensive  Economic Cooperation Agreements(CECAs)/Comprehensive Economic Partnership Agreements(CEPA) and Preferential Trade Agreements(PTAs) entered into by India is  given  in Annexure-I and Annexure-II respectively.  The  list  of  the  FTAs/PTAs currently  being  negotiated  is  given  in Annexure-III. As  regards  an  FTA  with Eurasian Economic Union, a joint statement to launch negotiations for FTA between India and the Union has been signed on 3 June, 2017.
- (b) : Assessment evaluation of FTAs is a continuous process including on sectors such as steel  and  agriculture.  Before  entering  into  negotiations  with  its  trading  partners, studies are undertaken internally, as well as through the Joint Study Group (JSG) to study  the  feasibility  of  the  proposed  FTAs,  including  their  impact  on  the  domestic stakeholders  including  the  Apex  Chambers  of  Commerce  and  Industry,  Industry Associations  as  well  as  the  Administrative  Ministries  and  Departments.  In  order  to protect the interest of the domestic industry and agriculture sector, these agreements provide for maintaining sensitive/negative lists of items on which limited or no tariff concessions  are  granted  under  the  FTA.    The  Government  has  largely  adopted  a conservative policy on agricultural products by maintaining a large number of them in the negative list of FTAs. In addition, in case of a surge in imports and injury to the domestic industry, a country is allowed to take recourse to the measures such as antidumping and safeguards.
- (c) :  The  Question  does  not  arise  as  India  has  not  entered  into  any  new  FTA  or Preferential  Trade  Agreement  (PTA)  during  the  last  three  years.  However,  India expanded  the  scope  of  the  India-ASEAN  Trade  in  Goods  (TIG)  Agreement  in November, 2014 to cover both Services and Investment with its date of implementation being 1 July, 2015.
- (d) :  The  Department  of  Commerce  is  negotiating  21  trade  agreements  including  with Israel and Mauritius. The details of these agreements under negotiation or review are at Annexure-III. The FTA negotiations are a continuous process and it is difficult to predict a time-line for conclusion.

## FTA's already in force

|   S. No. | Name of the Agreement                                                                                                                                                        | Date of Signing of the Agreement                                            | Date of Implementation of the Agreement                                                                                                                                                                                                                                                                                                                                                                            |
|----------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        1 | India - Sri Lanka FTA                                                                                                                                                        | 28th December. 1998                                                         | 1 st March, 2000                                                                                                                                                                                                                                                                                                                                                                                                   |
|        2 | Agreement on SAFTA (India, Pakistan, Nepal, Sri Lanka, Bangladesh, Bhutan, the Maldives and Afghanistan)                                                                     | 4th January, 2004                                                           | 1st January, 2006 (Tariff concessions implemented from 1 st July, 2006)                                                                                                                                                                                                                                                                                                                                            |
|        3 | India Nepal Treaty of Trade                                                                                                                                                  | 27 th October 2009                                                          | The Treaty has been extended for a further period of 7 years and is currently in force till 26 th October 2023.                                                                                                                                                                                                                                                                                                    |
|        4 | Revised Agreement of Cooperation between Government of India and Nepal to control unauthorized trade                                                                         | 27 th October, 2009                                                         | The Agreement has been renewed on 26 th October, 2016 for a further period of 7 years and is now valid till 26 th October, 2023.                                                                                                                                                                                                                                                                                   |
|        5 | India - Bhutan Agreement on Trade Commerce and Transit                                                                                                                       | 17 th January, 1972                                                         | Renewed periodically, with mutually agreed modifications. Agreement dated 29 th July 2006 was valid for 10 years. With mutual consent, the validity was extended for a period of one year or the period till the proposed new Agreement comes into force. The new Agreement has been signed on 12.11.2016. India and Bhutan have agreed that the new Agreement will come into force with effect from 29 July 2017. |
|        6 | India - Thailand FTA - Early Harvest Scheme (EHS)                                                                                                                            | 9 th October, 2003.                                                         | 1 st September, 2004                                                                                                                                                                                                                                                                                                                                                                                               |
|        7 | India - Singapore CECA                                                                                                                                                       | 29th June, 2005                                                             | 1st August, 2005                                                                                                                                                                                                                                                                                                                                                                                                   |
|        8 | India - ASEAN- CECA - Trade in Goods, Services and Investment Agreement (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam) | 13 th August, 2009 for goods and November, 2014 for Services and Investment | Goods  1st January 2010 in respect of India and Malaysia, Singapore, Thailand.  1 st June 2010 in respect of India and Vietnam.  1 st September 2010 in respect of India and Myanmar.  1 st October 2010 in respect of India and Indonesia.  1 st November 2010 in respect of India and Brunei.                                                                                                               |

## Annexure-I

| S. No.   | Name of the Agreement    | Date of Signing of the Agreement   | Date of Implementation of the Agreement                                                                                                                                                              |
|----------|--------------------------|------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                          |                                    |  24 January 2011 in respect of India and Laos.  1 st June 2011 in respect of India and the Philippines.  1 st August, 2011 in respect of India and Cambodia. Services and Investment 1 July, 2015 |
| 9        | India - South Korea CEPA | 7 th August 2009                   | 1 st January, 2010                                                                                                                                                                                   |
| 10       | India - Japan CEPA       | 16 th February, 2011               | 1 st August, 2011                                                                                                                                                                                    |
| 11       | India - Malaysia CECA    | 18 th February, 2011               | 1 st July, 2011                                                                                                                                                                                      |

## PTAs already in force:

|   S. No. | Name of the Agreement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Date of Signing of the Agreement            | Date of Implementation of the Agreement                                                                                            |
|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------|
|        1 | Asia Pacific Trade Agreement (APTA) (Bangladesh, China, India, Republic of Korea, Sri Lanka)                                                                                                                                                                                                                                                                                                                                                                                                                  | July, 1975 (revised on 2 nd November, 2005) | 1st Nov, 1976                                                                                                                      |
|        2 | Global System of Trade Preferences (GSTP) (Algeria, Argentina, Bangladesh, Benin, Bolivia, Brazil, Cameroon, Chile, Colombia, Cuba, Democratic People's Republic of Korea, Ecuador, Egypt, Ghana, Guinea, Guyana, India, Indonesia, Iran, Iraq, Libya, Malaysia, Mexico, Morocco, Mozambique, Myanmar, Nicaragua, Nigeria, Pakistan, Peru, Philippines, Republic of Korea, Romania, Singapore, Sri Lanka, Sudan, Thailand, Trinidad and Tobago, Tunisia, Tanzania, Venezuela, Viet Nam, Yugoslavia, Zimbabwe) | 13 th April, 1988                           | 19 th April, 1989                                                                                                                  |
|        3 | SAARC Preferential Trading Agreement (SAPTA)                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 11 April, 1993                              | 7 December, 1995                                                                                                                   |
|        4 | India - Afghanistan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 6th March, 2003                             | 13 th May, 2003                                                                                                                    |
|        5 | India - MERCOSUR                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 25th January, 2004                          | 1st June, 2009                                                                                                                     |
|        6 | India - Chile                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 8 th March, 2006                            | 11 th September, 2007. The agreement has been expanded on 6 th September, 2016 with date of its implementation as 16 th May, 2017. |

## Annexure-II

## FTAs/PTAs under Negotiation/Review:

|   S. No | Name of the Agreement                                                                                                                                                                                                                                                                       | Status                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       1 | India - EU BTIA (Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia ,Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, United Kingdom) | Negotiations launched on 28 th June 2007 in the areas of Goods, Services, Investment, Sanitary and Phyto-sanitary Measures, Technical Barriers to Trade, Trade Facilitation and Customs Cooperation, Competition, IPR & GIs. Etc. Sixteen rounds of negotiations and a number of inter-sessional and Chief Negotiator level meetings have been held till date. A Ministerial review meeting between Hon'ble Commerce & Industry Minister and EU's Trade Commissioner was held on 15 th April, 2013 at Brussels. After a period of lull, the negotiations were revived with 4 stocktaking meetings in January, February, July and November, 2016.                                                              |
|       2 | India - Sri Lanka Economic and Technical Cooperation Agreements (ETCA)                                                                                                                                                                                                                      | The negotiations on the text of the proposed Agreement are being carried out with Sri Lanka. Three rounds of negotiations have been held so far. The 4 th round of negotiations of the ETCA was held on 24-26 April, 2017 in New Delhi.                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|       3 | India - Thailand CECA                                                                                                                                                                                                                                                                       | Early Harvest Scheme on 82 items implemented. So far 30 rounds of India-Thailand Trade Negotiation committee (ITTNC) meetings have been held. The 30 th round was held on 13-14 July, 2016 in New Delhi.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|       4 | India - Mauritius CECPA                                                                                                                                                                                                                                                                     | Ten rounds of negotiations on India-Mauritius CECPA have been held between the two sides so far. The last round of negotiation was held between India and Mauritius on 23-24 October, 2006. Although the CECPA negotiations had been formally put on hold, they were revived in March, 2016 during the visit of the Hon'ble Prime Minister to Mauritius. There is likelihood of some technical engagement between the two sides in 2017.                                                                                                                                                                                                                                                                      |
|       5 | India EFTA TEPA (Iceland, Norway, Liechtenstein and Switzerland)                                                                                                                                                                                                                            | The India-EFTA TEPA (Trade and Economic Partnership Agreement) was launched in January 2008 (then known as BTIA). The first round was held in New Delhi during 6-8 October, 2008. The Chapters covered are Trade in Goods, Services, Investment,, Sanitary and Phyto-sanitary Measures (SPS), Technical Barriers to Trade(TBT), Trade Facilitation and Customs Cooperation, Competition, Intellectual Property Rights (IPR), Government Procurement (GP), Dispute Settlement(DS), Trade Defence(TD), Rules of origin(ROO), Sustainable Development (SD) and Legal & Horizontal etc. 16 rounds of negotiations have been held with the 16 th round of negotiation held on 29 May-2 June, 2017 in Lichtenstein. |
|       6 | India - New Zealand FTA/CECA                                                                                                                                                                                                                                                                | Ten Rounds of negotiation of CECA have been held so far. The 10th Round was held in New Delhi on 17-18 February, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

## Annexure-III

|   S. No | Name of the Agreement                                                                                                            | Status                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|---------|----------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       7 | India - Israel FTA                                                                                                               | Eight rounds of negotiations on India-Israel FTA have been held so far. The Eighth round was held in Israel from 24-26 November, 2013.                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|       8 | India - Singapore CECA                                                                                                           | Second review of India-Singapore CECA was launched in May, 2010. Recently a stock taking meeting on 2nd review of India- Singapore CECA was held on 8th November, 2016 in New Delhi                                                                                                                                                                                                                                                                                                                                                                                                    |
|       9 | India - SACU PTA (South Africa, Botswana, Lesotho, Swaziland and Namibia)                                                        | Five rounds of negotiations have been held so far. 1st Round of negotiation was held in Pretoria on October 5-6th, 2007 and the 5th round of negotiations held in October 2010 in New Delhi. During the 9th Joint Ministerial Commission (JMC) meeting held at Durban on 19th March, 2015 under the co-chairmanship of Honourable Minister of External Affair and South Africa's Foreign Minister, while discussing pending negotiations on finalization of INDIA- SACU PTA, the Indian side requested the South African side for assistance in holding the 6th round of negotiations. |
|      10 | India - Mercosur PTA expansion (Argentina, Brazil, Paraguay and Uruguay)                                                         | The existing India-MERCOSUR PTA is being expanded as substantial scope exists for India and MERCOSUR to explore complementarities and benefit from increased bilateral trade. The 3rd Meeting of Joint Administrative Committee was held in Brasilia on 29th September, 2016.                                                                                                                                                                                                                                                                                                          |
|      11 | BIMSTEC CECA (Bangladesh, India, Myanmar, Sri Lanka, Thailand, Bhutan and Nepal)                                                 | 20 meetings of the Trade Negotiation Committee (TNC) have taken place. The 20th Meeting of BIMSTEC Trade Negotiating Committee (TNC) was held during 07-09, September 2015 in Khon Kaen, Thailand.                                                                                                                                                                                                                                                                                                                                                                                     |
|      12 | India - Gulf Cooperation Council (GCC) Framework Agreement (Saudi Arabia, Oman, Kuwait, Bahrain, Qatar and United Arab Emirates) | Two rounds of negotiations have been held so far in 2006 and 2008. The second round was held in September 9-10, 2008. No round could take place in the last 7 years since GCC has deferred its negotiations with all countries and economic groups and is currently reviewing its negotiations with all countries and economic groups.                                                                                                                                                                                                                                                 |
|      13 | India - Canada FTA                                                                                                               | Nine rounds of negotiation on India-Canada CEPA have been held so far. The Ninth round was held in March, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|      14 | India - Indonesia Comprehensive Economic Cooperation Agreement (CECA)                                                            | Commencement of negotiation on Indonesia - India CECA was announced on 25th January 2011 during the visit of Indonesian President to New Delhi. Negotiations are yet to commence. The first meeting pre-negotiation and Biennial Trade and Investment Forum (BTIF) took place in Jakarta on October 3-4, 2011. Negotiation has been kept in abeyance watching progress of RCEP.                                                                                                                                                                                                        |
|      15 | India - Australia                                                                                                                | Nine rounds of negotiations have been held so far. The ninth round of negotiations was held on 21-23 September 2015, in New Delhi, India.                                                                                                                                                                                                                                                                                                                                                                                                                                              |

|   S. No | Name of the Agreement                                                                                                                                   | Status                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|      16 | India-Malaysia CECA (1st Review)                                                                                                                        | 1st meeting of the India-Malaysia Joint Committee meeting to review implementation of the Agreement was held on 8th December, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|      17 | Regional Comprehensive Economic Partnership (RCEP) Agreement among ASEAN + 6 FTA Partners (Australia, China, India, Japan, South Korea and New Zealand) | Based on the Declaration of the Leaders during the ASEAN Summit in November, 2012, negotiations for a comprehensive economic partnership between the 10 ASEAN member states and its 6 FTA partners commenced in May, 2013. 4 th RCEP Ministerial was held on 5 August, 2016. 3 rd Intersessional RCEP Ministerial was recently concluded in Ha Noi from 21-22 May, 2017. The 19 th Round of RCEP TNC and related meetings was held from 17-28 July, 2017 in Hyderabad. The negotiations cover a number of areas like trade in goods, services, investment, intellectual property, economic & technical cooperation, competition and legal &institutional issues. |
|      18 | India-ASEAN Trade in Goods Agreement (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam) (1 st Review) | The ASEAN Secretariat has agreed to the 1 st review of India- ASEAN trade in Goods Agreement in the coming months. The scope of review was finalized and the first meeting of the Trade Negotiating Committee (TNC) for review was held on 6 April, 2016 in Kuala Lumpur.                                                                                                                                                                                                                                                                                                                                                                                        |
|      19 | India-Korea CEPA review                                                                                                                                 | During the Joint Committee meeting at the Ministerial level held on 18 June, 2016 in New Delhi, the two sides declared commencement of negotiation for upgrading India-Korea CEPA. Two rounds of negotiation for upgrading India-Korea CEPA have been held so far with 2 nd round of negotiation held on 13-14 February, 2017 in New Delhi.                                                                                                                                                                                                                                                                                                                      |
|      20 | India-Iran PTA                                                                                                                                          | India and Iran have started discussions to enter into a preferential Trade Agreement (PTA). The broad principles of the PTA are being worked out before commencing negotiations on the text. So far, two meetings have taken place. The last meeting was held at New Delhi on 01-02 September, 2016. After the discussions and receipt of a communication from Iran, India has sent a response to Iran in January, 2017. Iran is yet to revert on our response. The dates of next meeting of India-Iran PTA are not yet finalised.                                                                                                                               |
|      21 | India-Peru Trade Agreement                                                                                                                              | The Cabinet in its meeting held on 18 th January, 2017 has approved holding negotiations for trade agreement with Peru on goods, services and investment. The process for negotiations has been initiated with the first round of negotiations scheduled on 8-11 August, 2017 in New Delhi.                                                                                                                                                                                                                                                                                                                                                                      |