India approves Trade Pact with Singapore
Singapore is an important trade partner of India with bilateral trade of over $5bn. Indian cabinet has approved India-Singapore Comprehensive Economic Cooperation Agreement (CECA) - that is tipped to significantly boost bilateral trade.
Though the balance of trade had always been in favour of Singapore, it tilted in India’s favour during 2005 at around $88m. With this pact - India has agreed to provide a series of tariff concessions to Singapore. The four-part agreement includes a free trade agreement, a bilateral investment promotion treaty, an improved double taxation avoidance agreement and an air services agreement. Prime Minister Manmohan Singh and Singapore Prime Minister Lee Hsien Loong will sign the omnibus CECA on June 29, and it will come into effect from August 1, ‘05.
The agreement may be notified to the World Trade Organisation (WTO) under the General Agreement on Tariff and Trade (GATT) and the General Agreement on Trade in Services (GATS). This is for the first time that India is entering into such a bilateral economic integration agreement in services.
While Indian beer will gain entry into Singapore, three of the island’s largest banks will now compete on equal terms with domestic entities. In turn, Indian banks already operating in Singapore will qualify for national treatment there. Singapore will welcome Indian professionals, including architects, accountants and doctors from next year. The concessions given by India cover about 80% of Singapore’s present exports to India.
June 26' 2005
