The India- Japan comprehensive market opening pact signed on Wednesday could more than double bilateral trade to $25 bn by 2014, commerce & industry minister Anand Sharma has said.
India will eliminate tariffs on 90% of its goods and Japan on 95% over ten years while movement of professionals between the countries will become much smoother once the comprehensive economic partnership agreement is ratified by the Japanese Parliament.
Some products like mobile phones, calculators, battery chargers, CDs and DVDs from Japan and textiles from India would face zero import duty right from the day the agreement is implemented. Japan would also lower tariffs on petrochemicals, chemical products, jewellery and cement.
In the services sector, India has been given concessions, including commitments for providing greater access for contractual suppliers, professionals such as accountants, researchers, tourist guides and management consultants.
It has also agreed to simplify visa regime for instructors for yoga practitioners, classical musical and dance practitioners, chefs and English language teachers. The Indian industry, which had fought hard to keep automobiles and auto parts from the tariff elimination list, is hopeful of increasing business with Japan once the treaty is implemented
"As the majority of Japan's non-agricultural tariff lines would see immediate duty elimination for exports from India, with a strategic approach India could significantly improve its share in Japan's total imports from the existing low level of 0.7%", Ficci secretary general Amit Mitra said.
According to CII chief Hari Bhatia, at $ 10.3 billion the trade relationship between our two countries has been far below its true potential. "We are certain that CEPA will lead to a quantum increase in bilateral trade and investment flows," he said. In his meeting with Japanese foreign minister Seiji Maehara, Mr Sharma set a target of doubling bilateral trade to $ 25 billion by 2014 from $10.36 billion last year. He suggested establishment of a joint revolving fund of $ 9 billion for kick starting the Delhi-Mumbai industrial corridor project.