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India's Prime Minister Narendra Modi is expected to travel to Kuala Lumpur on the 26th and 27th of October for the 47th ASEAN Summit. Around 3 weeks before his visit, the 11th Joint Committee Meeting for the review of the ASEAN-India Trade in Goods Agreement (AITIGA) is scheduled for 6th and the 7th of October at the ASEAN Secretariat in Jakarta in Indonesia, which will be hosted by Malaysia.
On the AITIGA review, government sources indicated that while progress has been noted in the past few months, some developments are expected in the joint committee meeting. Sources added that options remain open for separate FTAs with ASEAN member countries, indicating that India already has FTAs with ASEAN members Singapore and Malaysia.
The ASEAN bloc comprises of Brunei, Cambodia Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. It is among the trading blocs India is looking to increase its exports to undo the impact of US tariffs. ASEAN accounted for around 11% of India’s global trade with bilateral trade touching $123 billion in FY 2024-25.
Trade balance concerns
However, India is looking for a country-wise review of the AITIGA (ASEAN-India Trade in Goods Agreement) to contain its rising trade deficit with the 10-nation bloc.
While India's exports to the Association of South-East Asian Nations (ASEAN) member countries have risen 65.23% from $26,628 million in FY 2010-11 to $44,000 million in FY 2022-23, imports from ASEAN countries to India have grown 186% from $30,608 million in FY 2010-11 to $87,577 million in FY 2022-23.
Even in FY 2023-24, India's imports from ASEAN countries were recorded at $66,551 million against total exports of $32,713 million to the bloc, and $39 billion of exports compared to $84 billion in imports in FY 2024-25.
India had hosted the 10th Meeting of the AITIGA Joint Committee at Vanijya Bhawan in New Delhi from 10th to 14th August this year. The Joint Committee had focused on advancing the ongoing review of AITIGA to enhance its effectiveness, accessibility, and trade facilitation capabilities by building on the progress achieved through eight active rounds of negotiations.
Seven of the eight Sub-Committees under the AITIGA Joint Committee had also met on the margins, namely: The Sub-Committee on Customs Procedures and Trade Facilitation (SC-CPTF), Legal and Institutional Issues (SC-LII), National Treatment and Market Access (SC-NTMA), Sanitary and Phytosanitary (SC-SPS), Rules of Origin (SC-ROO), Standards, Technical Regulations and Conformity Assessment Procedures (SC-STRACAP), and Trade Remedies (SC-TR).
These meetings provided a platform for deeper collaboration, ensuring alignment with the broader goals of updating AITIGA. Earlier this year too, in March, both the sides had agreed to speed up the AITIGA review for a conclusion within 2025 itself.
On 10th July, India's Commerce and Industry Minister Piyush Goyal held a virtual meeting with Malaysia's Minister of Investment, Trade & Industry T Zafrul Aziz to discuss the ongoing AITIGA review. Malaysia is India's permanent coordinator from ASEAN on economic matters. The Ministers also discussed furthering discussions on India-Malaysia Comprehensive Economic Cooperation Agreement (CECA).
On the AITIGA review, sources had earlier indicated that India had opened 71% of its tariff lines while Indonesia had opened only 41%, Vietnam had opened 66.5%, and Thailand had opened 67% of tariff lines despite India having a lower per capita income.
Stating that the government has only reflected anguish of the Indian industry against ASEAN FTA while renegotiating and reviewing the FTA, sources had questioned why duties on Chinese imports were reduced by the UPA regime. Pointing out that subsidized goods from a 3rd country were found to be dumped until India levied anti-dumping duty, sources indicated that India cracked down on dumping of steel imports via Safeguard duty as the "melt-and-pour" clause wasn't put in the FTA with the ASEAN bloc.
Changing ASEAN positions
In October 2024, Indian government sources had told CNBC TV18 that bilateral positions of many ASEAN countries have changed since the implementation of the agreement in 2010 and some of them don't reflect the same position anymore. Stating that the 10-nation bloc is not a common customs union but a grouping of countries at different stages of development, sources had added that India is trying to build flexibility in review while speaking to individual countries. There have been concerns raised by Indian industry over cheap imports from ASEAN countries impacting domestic industries in the steel and electronics sector.
On the AITIGA review, government sources indicated that while progress has been noted in the past few months, some developments are expected in the joint committee meeting. Sources added that options remain open for separate FTAs with ASEAN member countries, indicating that India already has FTAs with ASEAN members Singapore and Malaysia.
The ASEAN bloc comprises of Brunei, Cambodia Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. It is among the trading blocs India is looking to increase its exports to undo the impact of US tariffs. ASEAN accounted for around 11% of India’s global trade with bilateral trade touching $123 billion in FY 2024-25.
Trade balance concerns
However, India is looking for a country-wise review of the AITIGA (ASEAN-India Trade in Goods Agreement) to contain its rising trade deficit with the 10-nation bloc.
While India's exports to the Association of South-East Asian Nations (ASEAN) member countries have risen 65.23% from $26,628 million in FY 2010-11 to $44,000 million in FY 2022-23, imports from ASEAN countries to India have grown 186% from $30,608 million in FY 2010-11 to $87,577 million in FY 2022-23.
Even in FY 2023-24, India's imports from ASEAN countries were recorded at $66,551 million against total exports of $32,713 million to the bloc, and $39 billion of exports compared to $84 billion in imports in FY 2024-25.
India had hosted the 10th Meeting of the AITIGA Joint Committee at Vanijya Bhawan in New Delhi from 10th to 14th August this year. The Joint Committee had focused on advancing the ongoing review of AITIGA to enhance its effectiveness, accessibility, and trade facilitation capabilities by building on the progress achieved through eight active rounds of negotiations.
Seven of the eight Sub-Committees under the AITIGA Joint Committee had also met on the margins, namely: The Sub-Committee on Customs Procedures and Trade Facilitation (SC-CPTF), Legal and Institutional Issues (SC-LII), National Treatment and Market Access (SC-NTMA), Sanitary and Phytosanitary (SC-SPS), Rules of Origin (SC-ROO), Standards, Technical Regulations and Conformity Assessment Procedures (SC-STRACAP), and Trade Remedies (SC-TR).
These meetings provided a platform for deeper collaboration, ensuring alignment with the broader goals of updating AITIGA. Earlier this year too, in March, both the sides had agreed to speed up the AITIGA review for a conclusion within 2025 itself.
On 10th July, India's Commerce and Industry Minister Piyush Goyal held a virtual meeting with Malaysia's Minister of Investment, Trade & Industry T Zafrul Aziz to discuss the ongoing AITIGA review. Malaysia is India's permanent coordinator from ASEAN on economic matters. The Ministers also discussed furthering discussions on India-Malaysia Comprehensive Economic Cooperation Agreement (CECA).
On the AITIGA review, sources had earlier indicated that India had opened 71% of its tariff lines while Indonesia had opened only 41%, Vietnam had opened 66.5%, and Thailand had opened 67% of tariff lines despite India having a lower per capita income.
Stating that the government has only reflected anguish of the Indian industry against ASEAN FTA while renegotiating and reviewing the FTA, sources had questioned why duties on Chinese imports were reduced by the UPA regime. Pointing out that subsidized goods from a 3rd country were found to be dumped until India levied anti-dumping duty, sources indicated that India cracked down on dumping of steel imports via Safeguard duty as the "melt-and-pour" clause wasn't put in the FTA with the ASEAN bloc.
Changing ASEAN positions
In October 2024, Indian government sources had told CNBC TV18 that bilateral positions of many ASEAN countries have changed since the implementation of the agreement in 2010 and some of them don't reflect the same position anymore. Stating that the 10-nation bloc is not a common customs union but a grouping of countries at different stages of development, sources had added that India is trying to build flexibility in review while speaking to individual countries. There have been concerns raised by Indian industry over cheap imports from ASEAN countries impacting domestic industries in the steel and electronics sector.
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