New Delhi: India and the 10-member Association of Southeast Asian Nations or ASEAN are expected to sign their free-trade agreement (FTA) in services and investment by December and operationalise the ambitious pact by July 2014, a senior Indian foreign ministry official said on Monday as he urged increased connectivity between Asia's third-largest economy and the high-growth economic bloc.

Ashok Kantha, secretary (east) in the ministry of external affairs, said that ASEAN was expected to coalesce into the ASEAN Economic Community by 2015 and that both sides had elevated their ties to a strategic partnership at the December 2012 India ASEAN Commemorative Summit in New Delhi-organised to mark 20 years of interaction between the two. With the ambitious free trade pact in services and investment expected in place by the middle of next year, Kantha said the time had come to take the "big leap" in the area of connectivity to reap the benefits of these arrangements. "We are approaching physical connectivity in mission mode," Kantha said at a business conclave organised in New Delhi by the Confederation of Indian Industry business lobby group to strengthen trade and business links with Cambodia, Laos, Myanmar and Vietnam. ASEAN groups together Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Laos, the Philippines, Singapore, Thailand and Vietnam. Together, India and the ASEAN make up a community of 1.8 billion people with a combined gross domestic product of $3.8 trillion. India and the ASEAN operationalised a free trade agreement (FTA) in goods in 2010 and trade between the bloc and India reached $80 billion in 2011-12. Both sides have set a target of $200 billion by 2022. Referring to existing connectivity projects that include a highway from India's northeast to Thailand through Myanmar, Kantha said the Indian government was considering the extension of the road link to Laos, Cambodia and onward to Vietnam after the roads to Myanmar and Thailand were completed by 2016. Similarly, another ambitious project linking India's landlocked northeast through Myanmar was on track to be completed by 2016, he said. Underlining the importance of connectivity with ASEAN, Kantha said: "For us in the government of India and the state governments of the northeast, ASEAN will be the preferred window ....to the outside world." He was referring to the Indian government's efforts to develop the region riven by insurgencies to ensure its economic development. He urged the business community to look at establishing economic corridors along the various routes planned to link India and the ASEAN and assured that the ASEAN-India Transit and Transport agreement to provide seamless connectivity between the two regions would be in place before the India-Myanmar-Thailand highway was completed in 2016. Referring to Cambodia, Laos, Myanmar and Vietnam, Kantha said that Indian businesses had invested $2 billion in Myanmar and $1 billion in the other three countries. India shared land and sea boundaries with these countries that were India's immediate eastern neighbours in the ASEAN and connectivity was an imperative for greater economic linkages.

By Elizabeth Roche

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