Indian told to invest in ASEAN
Indian told to invest in ASEAN
JAKARTA (JP): Secretary General of the Association of Southeast Asian Nations (ASEAN), Dato' Ajit Singh, told potential Indian investors yesterday to start investments in the region to benefit from the ASEAN Free Trade Area (AFTA), which will completely come into effect in 2003.
"Such investments should be made as soon as possible in view of the fact that the implementation of AFTA has been accelerated from 15 years to 10 years," Ajit Singh told executives of the Economic Association of Indonesia and India in a gathering at the Mercantile Club.
The current schedule of tariff reduction under a Common Effective Preferential Tariffs scheme for AFTA indicates that the average tariff rate will fall to 2.6 percent by the year 2003 from about 20 percent at present.
ASEAN has also agreed to eliminate non-tariff barriers within the coming five years.
Singh said ASEAN has anticipated that non-ASEAN countries will also benefit from AFTA, provided that they are ready to invest in the region.
He said that even though ASEAN is closed for India in terms of its membership, which is confined only to countries in South East Asia, the benefits from free trade are not closed to India.
For Indian investors, Singh said, ASEAN is attractive because it is the gateway to the East Asian economies, the world's fastest growing region. Besides, ASEAN enjoys a stable socio- economic environment and has a conducive climate for investment.
He noted that, for the ASEAN business community, India has several advantages, including its large and growing market and sizable middle income group.
"ASEAN and India should take advantage of their complementariness and form more joint ventures to take advantage of the growing trade and investment opportunities on both sides," Singh told the gathering, which was attended mostly by Indian nationals and descendants.
Singh explained that trade between the two sides is indeed small, compared to the potency that exists. The two-way trade increased to US$2.5 billion in 1993 from $2.2 billion in 1990, with a favor for India.
India's exports to ASEAN countries increased by 105 percent to $1.5 billion in 1993 from 1990, while its imports declined by 32 percent to $991 million. (rid)