India, Singapore to ink accord
Himalayan News Service
New Delhi, June 27:
India’s trade diplomacy will get a shot in the arm when Singapore prime minister Lee Hsien Loong comes to India to sign a landmark economic cooperation pact on a three-day visit beginning tomorrow.
Prime Minister Manmohan Singh and Lee are expected to sign the Comprehensive Economic Cooperation Agreement (CECA) that promises to cement bilateral ties and take them to a new level.
“Other issues, including defence ties, will be discussed but the main focus will be on growing trade and economic cooperation between the two countries,” said a diplomatic source. The Cabinet Committee on Economic Affairs presided over by Manmohan Singh cleared the agreement — which will come into effect from August 1 — last week. Commerce Minister Kamal Nath has described the pact as “a milestone in further cementing India’s traditional ties with Singapore”.
“It is also for the first time that India is entering into a bilateral economic integration with another country,” he said. Singapore is India’s most important trading partner amongst the Association of Southeast Asian Nations (ASEAN) countries and also India’s gateway to ASEAN and China.
In 2003-04, India was Singapore’s 14th largest trading partner, with total trade estimated to be worth $6.4 billion annually. The balance of trade, traditionally in Singapore’s favour, tilted towards India to the extent of $1.2 billion in 2004-05.
For India, the CECA would be a vital economic component of its ‘Look East’ policy. India-ASEAN trade has grown by more than five times since 1991 to $10.3 billion in 2001. The agreement is an integrated package consisting of trade in goods and services, investments, mutual recognition of standards in goods, services, customs, media, science and technology intellectual property and education. In merchandise goods, the pact comprises four lists, including an early harvest programme where India will eliminate customs duties immediately on 506 items and a phased elimination programme for 2,202 items by 2009.
Kamal Nath is upbeat about Singaporean investments in India, which increased by about 114 per cent in 2004-05. He foresees a 300 per cent growth in the near future. Another highlight of the visit will be a discussion on growing defence relations. A memorandum of understanding (MoU), aimed at outlining the detailed arrangements for the first India-Singapore Army to Army Exercise, was signed early this year. Singaporean Chief of Army Major General Desmond Kuek, who came here on a three-day visit last week, discussed with Army Chief JJ Singh the modalities of holding joint army exercises.