India has called upon Singapore and South Korea to expedite the review of existing trade agreements, to reach conclusions as soon as possible. New Delhi believes that the trade deals signed with ASEAN and Korea have not been advantageous for Indian exporters, while the other parties have profited significantly from the Indian market.
During a meeting with Singapore’s Minister of Trade and Industry, Gan Kim Yong, in San Francisco, India’s Commerce and Industry Minister, Piyush Goyal, emphasized the need for a swift conclusion to the review of the ASEAN India Trade in Goods Agreement (AIGTA). Singapore is a member of the Association of Southeast Asian Nations (ASEAN), which consists of 10 countries. Both sides previously committed to completing the review by 2025 and holding quarterly meetings to meet this deadline during the India-ASEAN Summit in August.
The trade deficit with ASEAN has widened from $4.98 billion in 2010-11, the first full year of AITGA’s operation, to $43.57 billion in 2022-23. The substantial increase of $17.51 billion in the deficit in the last financial year has raised concerns. Likewise, Goyal requested an accelerated review of the Comprehensive Economic Partnership Agreement (CEPA) with South Korea during his meeting with Korean Trade Minister Dukgeun Ahn. India signed the CEPA with South Korea in 2009, reducing tariffs on 90% of Indian goods over ten years, while India lowered taxes on 85% of Korean goods. However, India argues that the trade deal has not significantly benefitted Indian exports.
India’s exports to Korea only increased to $6.6 billion in FY 23 from $4.7 billion in 2018-19, while imports from Korea rose from $16.7 billion in FY 19 to $21.1 billion last year. The Indian Commerce Minister is currently in the United States for the meeting of the 14-nation Indo-Pacific Economic Framework (IPEF), which includes Australia, Brunei, Fiji, Indonesia, Japan, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Thailand, the United States, and Vietnam. Goyal also held a bilateral meeting with US Trade Representative Katherine Tai, discussing ways to strengthen trade and investment ties and achieving common ground on key World Trade Organization (WTO) issues for a favourable outcome at the 13th Ministerial Conference (MC13).
