CECA review may begin soon

CECA review may begin soon

It will address areas such as mutual recognition agreements
By MALMINDERJIT SINGH
 

[SINGAPORE] The review of Singapore’s Comprehensive Economic Cooperation Agreement (CECA) with India could be launched as soon next month, said India’s High Commissioner to Singapore, TCA Raghavan, at the sidelines of the Opportunities in Special Economic Zones (SEZ) Sector in India conference yesterday.
Mr Raghavan said that some preliminary work has already been done for a review of the CECA, and it will be formally launched when Minister for Trade Lim Hng Kiang visits India. He added that the review will take into account the changes in the overall trade scenario since the CECA was signed in 2005, which provides traders in Singapore more opportunities as they can now benefit from both the CECA and the Asean-India free trade agreement.
“I think the review will certainly address areas which both sides feel could do with more focus. One area is the MRAs – the Mutual Recognition Agreements. There has been some progress, and some things only mature over time. And the MRAs are a process which depends a lot on the professional organisations on both sides. I think there will be progress in those areas,” elaborated the high commissioner on the possibility of a new and improved CECA.
He also told reporters that the CECA review will be an ongoing dialogue with both countries’ trade ministers making bilateral visits. The review is expected to extend over several months and is expected to be completed substantially by the end of this year.
Singapore is the second largest investor in India, providing 9 per cent of India’s total foreign direct investment (FDI) flows. Mr Raghavan was confident that investment flows between both countries can grow out of the shadows of last year’s dampened global investment climate, and attributed this to India’s macroeconomic stability and a potentially high quality trade in investments agreement between India and Asean, which Singapore investors may find complementary to the CECA.
“One example is the very good turnout we’ve seen in this conference from both India and Singapore. From India, we have about 35 SEZ developers and officials participating, and even more so in terms of the local participation and the queries we have had. The High Commission can provide a platform and our intention is to make the platform as focused as possible, that is to look at the sectors and sub-sectors because the overall argument is now well made and well known – that is, the Indian economy is going to be a growth story over the next decade,” he said.
LB Singhal, director general of India’s Export Promotion Council for Export Oriented Units and SEZs (EPCES), said that there were 575 formal SEZ approvals in India at the end of 2009. Some 105 of these were already functioning and housing as many as 2,761 units, he said. He also pointed out that Singapore companies could play a role in these SEZs as developers or as individual units. In doing so, he highlighted that they stand to benefit through various tax exemptions, duty free goods and 100 per cent FDI through the automatic route, among other features.
Mr Lim said that Singapore companies have gained much experience from planning, developing and implementing SEZs in the region and could apply this expertise to the Indian case, notably in the areas of master planning and industrial development, and in establishing an efficient transport and logistics chain.
Mr Lim noted that although concerns surrounding land acquisition, resettlement and creation of employment need to be addressed and managed effectively, Singapore companies such as Ascendas have done well in India and have a lot to offer to SEZs there.