The Hindu : International / India & World : Stage set for signing of economic pact between India and Singapore

Online edition of India's National Newspaper
Wednesday, Jun 22, 2005

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International - India & World

Stage set for signing of economic pact between India and Singapore

P. S. Suryanarayana

A positive move towards strengthening of relations, says Singapore Indian Chamber

SINGAPORE: Singapore Prime Minister Lee Hsien Loong is likely to visit India soon for the signing of the Comprehensive Economic Cooperation Agreement (CECA), the text of which was approved by the Indian Cabinet on Monday, according to diplomatic sources.

While there was no immediate and authoritative announcement here about the details of the agreement, sources indicated that Singapore should be able to reap "an early harvest" in respect of over 500 items, subject to the mutually agreed "rules of origin".

Singapore, in contrast, has long pursued a policy of zero-duty on almost all imports from all over the world, except for three categories such as tobacco products, motor vehicles and liquor products.

`FTA plus'

With the accord as finalised being "a free trade agreement (FTA) plus," the first of its kind for India with any country, the CECA, which covers trade in goods as also services besides investment flows and "mutual recognition" clauses, is expected to help the City-State widen its frontiers of international commerce, according to the sources. Singapore has close economic linkages with the U.S., Japan and China among others.

The news of India's approval of the CECA text, seen here as the culmination of a negotiating process that took over two years to complete, was welcomed by the Chairman of the Singapore Indian Chamber of Commerce and Industry, M. Rajaram, as a "positive move towards the strengthening of the economic relations between the two countries".

Expressing the hope that the business communities in both countries could now "leverage" on this "win-win" development, Mr. Rajaram lauded the political and official efforts that shaped the accord. Trade and industry circles here took note of the fact that the official announcement in New Delhi was somewhat silent on the final deal on issues concerning the banking and aviation sectors.

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