Advertisement
India’s China loophole concerns fuel Asean free trade deal rethink
- New Delhi’s review of zero-duty tariffs under its trade pact with Asean comes amid domestic concerns about cheap Chinese imports
3-MIN READ3-MIN
5
India faces a delicate balancing act as it prepares to review zero-duty imports under its free-trade agreement with Southeast Asian nations.
On one hand, domestic businesses are anxious about cheap imports flooding the market. On the other, New Delhi must safeguard its strategic interests in maintaining ties with Asean.
Economists like Biswajit Dhar, a professor at the Council for Social Development in Delhi, warn that the FTA has provided a back door for China to route duty-free supplies into the Indian market, eroding the competitiveness of local companies.
Advertisement
“While there is a case [to raise import duties], we will have to tread carefully,” Dhar said. “Any talk of increasing duty will be like jarring notes,” he added, noting that FTAs also signify strategic partnerships that extend beyond just economic ties.
India’s coming talks with the Association of Southeast Asian Nations, scheduled for July 29-31 in Jakarta, will test its ability to strike this balance.
The Asean bloc, which includes some of the region’s fastest-growing economies, presents a formidable challenge for India. Chinese firms have a strong presence across the 10 nations – Indonesia, Malaysia, Singapore and Thailand among them.
Advertisement
Select Voice
Select Speed
1.00x