Since its beginning about a decade ago, the partnership between India and the Association of South East Asian Nations (ASEAN) comprising Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam has been developing at quite a fast pace.

India became a sectoral dialogue partner of ASEAN in 1992. Mutual interest led ASEAN to invite India to become its full dialogue partner during the fifth ASEAN summit in Bangkok in 1995. India also became a member of the ASEAN Regional Forum (ARF) in 1996. India and ASEAN have been holding summit level meetings on an annual basis since 2002.

India signed a Free Trade Agreement (FTA) with the ASEAN members in October 2009 in Thailand.

Under the ASEAN-India FTA, the ASEAN member countries and India will lift import tariffs on more than 80 per cent of traded products between 2013 and 2016.

Also, tariffs on sensitive goods will be reduced to 5 per cent in 2016, while tariffs will be maintained on up to 489 items of very sensitive products.

India and ASEAN are currently negotiating Agreements on Trade in Services and Investment. The services negotiations are taking place on a request-offer basis, wherein both sides make requests for the openings they seek and offers are made by the receiving country based on the requests. There are four meetings scheduled between January and July and the deal is expected to be finalised by August 2010.

India has made requests in a number of areas including teaching, nursing, architecture, chartered accountancy and medicine as it has a large number of English speaking professionals in these areas who can gain from job opportunities in the ASEAN region. India is also keen on expanding its telecom, IT, tourism and banking network in the ASEAN countries.

Trade

The deepening of ties between India and ASEAN is reflected in the continued buoyancy in the trade figures. The trade grew by 13 per cent during April-September 2007-08 to US$ 17.02 billion as against US$ 15.06 billion during the same period in 2006-07. ASEAN is India’s fourth-largest trading partner after the EU, US and China. Indo-ASEAN trade, which has been growing at a compounded annual growth rate (CAGR) of 27 per cent since 2000, stood at US$ 38.37 billion in 2007-08. The bilateral trade between India and the ten-member ASEAN now stands at US$ 48 billion annually.

Singapore

The growing bilateral economic relationship is reflected in the rapidly rising bilateral trade between Singapore and India. The cumulative FDI inflow to India from Singapore during April 2000-April 2009 was around US$ 7.9 billion. Singapore continues to be the single largest investor in India amongst the ASEAN countries with FDI inflows into India and the second largest amongst all countries, rising to US$ 3.45 billion in 2008-09. FDI inflows from Singapore between April-July 2009 stood at US$ 759 million, taking the cumulative inflows from April 2000 - July 2009 to US$ 8.57 billion.

The total bilateral trade during 2007-08 was US$ 15.49 billion and India exported goods worth US$ 6.6 billion in April-December 2008-09.

ICICI Bank is all set to become the second Indian financial institution to get a full-fledged banking licence in Singapore, which will allow it to set up branches, ATMs, take deposits and disburse loans like a local bank. State Bank of India is already a fully recognized bank in Singapore.