ASEAN markets more accessible to Indian companies: FICCI
Free trade agreement (FTA) withAssociation of Southeast Asian Nations (ASEAN) has increased market access for Indian companies, a survey by the Federation of Indian Chambers of Commerce and Industry (FICCI) said on Sunday.
"FTA has opened up more opportunities for Indian industries in terms of greater market access for their products in the ASEAN region," said the FICCI in its findings on the impact of the FTA on Indian industry.
Under the FTA signed August, 2009, ASEAN member countries and India will lift import tariffs on more than 80 percent of traded products between 2013 and 2016. It became operational in 2010 between India and a few ASEAN countries.
"A majority of the respondents - 59 percent-- foresee no negative impact of duty reduction in the domestic market," said the study conducted on 78 companies across sectors.
The study further revealed that 20 percent respondents in sectors like engineering products, processed food, textiles, garments, plantation crops and auto parts have reported a fast pace of imports from ASEAN.
A majority of respondents-- 72 percent said that the sourcing of certain products from ASEAN countries post-FTA would not render manufacturing of these products uneconomical in India.
The industry body also recommended some steps to the government like reducing tariff on certain raw materials of "electrical products, laminates and natural rubber" to support the Indian manufacturing industry.
FICCI also asked for a reduction in transaction costs and incentives for importing edible palm oil.
"Greater support to MSME (micro-small medium enterprise) sector and agriculture (plantation crops) sector must be provided by the government," the survey stated.