Malaysia Hopes To Conclude FTA With India By End-2010

by Mary Swire, Tax-News.com, Hong Kong

15 January 2010

Malaysia’s Premier, Mohd Najib Tun Razak, hopes to use his visit to India this month to restart negotiations on a bilateral free trade agreement (FTA) with India, so that it may be signed before end-2010.

Negotiations on the FTA began in January 2008, and it was then hoped that they would be concluded by end-2008 and become effective last year. The discussions were, however, halted, and the bilateral FTA put to one side, while India concentrated on concluding an FTA with the Association of Southeast Asian Nations (ASEAN), of which Malaysia is also a member, and which came into force on January 1, 2010.

Within ASEAN countries, India already has trade agreements with Singapore and Thailand, while the beginning of economic cooperation negotiations with Indonesia has been recommended by a joint study group.

Mr Najib has therefore said that he feels that his visit is timely and the right opportunity to provide the political impetus to reactivate and increase the speed of Malaysia’s own FTA talks with India, and to achieve their conclusion before the end of the year.

A bilateral FTA will, it is hoped, further increase trade between the two countries, which totaled over USD10bn in 2008. Malaysian exports to India represented some USD7bn of that total.

As a representation of the deepening cooperation between India and Malaysia, it is expected that as many as 13 agreements will be signed during the visit. They will cover such subjects as oil and gas exploration, road construction, ICT, tourism, pharmaceuticals, and biotechnology.

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