Thailand wants India to fast-track its decision on the proposed full-fledged free trade agreement (FTA) with the country to increase trade and investment flows.
With economic uncertainties gripping the West, Bangkok is trying to strengthen its partnership with Asian countries through bilateral FTAs and regional pacts like the Regional Comprehensive Economic Partnership (RCEP), Thai deputy PM Somkid Jatusripitak said.
“I think we will have to ask your Cabinet when it wants to give its approval to an FTA with Thailand. We want decision-making to be accelerated,” Jatusripitak said referring to the proposed FTA with India in an interaction with the media.
The change of government in the US is leading to a total change in direction in trading regulations that the country had built in the last three decades, he said.
In fact, one of the first decisions taken by US President Donald Trump after assuming power was to disassociate the country from the Trans Pacific Partnership, an ambitious free trade pact that the Obama regime had inked with 11 Pacific rim countries, four of which were from the 10-member Asean bloc.
“We also don’t have any idea what the EU would be like after the process of the UK’s exit from the EU is over,” the deputy PM added.
With the uncertain environment in the West, many Asian countries are realising the importance of connectivity with each other as their combined market size is half of that of the world. “Asia has the power of a strong supply chain and technological progress that has spread to many countries. The value chain in Asia has to continuously grow and in turn get linked with the global value chain for overall prosperity,” he said.
Thailand prime minister Prayut Chan-o-cha and Indian prime minister Narendra Modi agreed to speed up the FTA talks in a meeting in June last year but not much progress has happened since then. New Delhi wants to see what shape the proposed RCEP – a pact between the Asean (including Thailand), India, China, Japan, Australia and New Zealand – takes before it gets into an FTA with Thailand as RCEP would be the less ambitious of the two, a Commerce Ministry official explained.
India is also a bit cautious on the FTA with Thailand as the early harvest programme with duty reduction in 82 items entered into by the two in 2006 had created some initial glitches for items such as television tubes and gold.
The target of increasing bilateral trade from $8.5 billion in 2015-16 to $16 billion by 2021 has been fixed by businesses from both countries.
IT, pharmaceuticals, bio-technology, automotives and tourism are some of the identified areas for cooperation.