India is being urged to speed up comprehensive free-trade talks with Thailand, with little progress having been made on a long-awaited pact.
After meeting the Indian ambassador to Thailand, Bhagwant Singh Bishnoi, yesterday, Commerce Minister Apiradi Tantraporn said the Thai side first wanted to settle key details of the pact, leaving minor contentious issues for later discussion.
Thailand and India signed a framework agreement covering the liberalisation of trade in goods, services and investment on Oct 9, 2003.
It was agreed that Thailand and India would begin talks and establish a Thai-Indian free trade agreement (FTA) by 2010. Both countries initially agreed to enact an early harvest scheme (EHS), meaning agreements on one or more topics must be concluded before the scheduled completion of a multi-issue round.
The agreement specified tariff reductions under the EHS for 82 items, including fruits, processed food products, gems and jewellery, iron and steel products, auto parts, electronic goods and electric appliances. Tariffs on these products were eliminated on Sept 1, 2006.
India is Thailand's 15th-biggest trading partner and largest in South Asia. Over the last five years, annual two-way trade averaged US$8.47 billion.
In 2015, two-way trade reached $7.92 billion, making up 1.9% of Thailand's exports. Thailand enjoyed a trade surplus with India of $2.67 billion last year.
Key shipments from Thailand included plastic pellets, chemicals, cars and parts, engines, steel, machinery, air conditioners and parts, gems and jewellery, and computers and parts. Thailand imported mainly chemicals, machinery, gold and precious stones, pharmaceutical products, ores and steel.
A source said the huge trade deficit was one of the key reasons why India baulked at pursuing further trade talks.
Thai-India FTA talks were revived in 2015 by the Prayut Chan-o-cha government after having stalled for nearly 10 years.
Talks between high-ranking officials last June to update progress on comprehensive Thai-Indian FTA negotiations provided another twist, as Thailand proposed to extend the talks to cover textiles and petrochemicals, while India requested to withdraw sugar and rubber gaskets from planned tariff cuts.
India also proposed a new schedule for talks with the investment sector, a revision of the criteria on sanitary and phytosanitary (pests and pathogens) measures, and an acceleration of liberalisation for occupations in which India is interested.