S'pore sees free trade with India by midyear

S'pore sees free trade with India by midyear

Rajesh Mahapatra Associated Press New Delhi

Singapore's trade minister said on Wednesday his country would likely sign a free-trade pact with India by the middle of this year, paving the way for greater integration of the city-state with the South Asian nation of more than 1 billion people.

"Singapore will be to India what Hong Kong is to China," Trade Minister George Yeo said of the benefits from a Comprehensive Economic Cooperation Agreement between India and Singapore.

Indian businesses hope that tapping the world market will be easier through Singapore, which has made free trade agreements a cornerstone of its economic policy, inking deals with the United States, Australia, Japan and several others.

Singapore is a member of the 10-country Association of Southeast Asian Nations, with which India is also negotiating a free trade pact.

India's annual trade with ASEAN is about US$10 billion, of which about 70 percent is with Singapore.

Besides providing preferential trade treatment, the agreement between India and Singapore would cover cross-border investment and cooperation in 10 sectors, including education, shipping and tourism.

Officials from Singapore and India have held several rounds of negotiations since May last year, focusing on tariff concessions, rules of origin for export, customs procedures, and antidumping.

"Now (the agreement) has come up to the final stage," Yeo told a gathering of Indian businesses in New Delhi. "There are some difficult issues, which I hope will be resolved soon at high- level meetings."

The two countries had earlier planned to sign the deal by April, but the process has been delayed by upcoming general elections in India.

It appears that the deal will be signed only after a new government takes charge in New Delhi. Elections are expected to be held in April and May and a new government will likely be formed by June.