Dr. Jyotsna Suri, Immediate Past President, FICCI
Mr. Sumit Mazumder, President, CII
Mr. Sunil Kanoria, President, ASSOCHAM
Mr. Shiv Siddhant Narayan Kaul, President, ICC
Mr. Vijay Kalantri, President, AIAI
Distinguished Speakers and Delegates,
Ladies and Gentlemen,
- I am delighted to address the Business Session of the eighth edition of the Delhi Dialogue.
- India is currently undergoing economic and social transformation on a scale and a speed that is unmatched in history. The Indian economy is the fastest-growing major economy with a growth rate of 7.3% in 2014-15.
- We have undertaken a number of steps to improve the business climate which have resulted in FDI inflows going up by 40%; we have become world's 7th most valued nation brand with a 32% sprint in brand value; we have improved our UNCTAD ranking of investment attractiveness from 15th to 9th place, and Moody's have upgraded our rating as positive.
- We have started liberalizing the FDI regime along with other reforms. We allowed 100% FDI in railways and enhanced the FDI limit to 49% in Defence and Insurance. We are also actively addressing the last mile operational issues in such policies.
- At the same time, with the formal establishment of the ASEAN Economic Community (AEC) in December 2015, ASEAN is forging ahead as a community by deepening its economic integration. Collectively the third-largest economy in Asia and the seventh in the world, the AEC offers many prospects and opportunities, including a middle-income market of 622 million people. It will further enable our businesses to jointly explore opportunities in the wider Southeast Asian region.
- At the last ASEAN-India Summit in November 2015, Prime Minister, Shri Narendra Modi, called India and ASEAN "two bright spots of optimism” amidst ongoing global economic uncertainties.
- ASEAN is India’s fourth-largest trading partner. Bilateral trade between ASEAN and India has crossed US$ 76.53 billion in 2014-15, with India's exports amounting to US$ 31.82 billion, and imports amounting to US$ 44.72 billion. Among the ASEAN member states, Indonesia is the largest trading partner of India, with bilateral trade of US$ 19.03 billion in 2014-15, followed by Malaysia, Singapore, and Thailand.
- Singapore leads among ASEAN countries in inward investments, emerging as the second-largest source of FDI for India globally, with inflows amounting to US$ 38.8 billion till September 2015, which is 14.6% of total FDI inflow. Singapore is followed by Malaysia (US$7.6 billion) and Indonesia (US$6.2 billion). In turn, Singapore is a huge recipient of Indian investment, with outflows from India amounting to USD $ 37.8 billion.
- Enhancing the India-ASEAN trade is a priority area under the new Plan of Action to implement the ASEAN-India partnership for peace progress and shared prosperity (2016-20). The Plan of Action envisages a number of steps in the areas of Trade and Investment, Finance, Transport, Food, Agriculture, Forestry, Information and Communication Technology, Tourism, Science, Technology and Innovation, and Mining and Natural Resources Management.
- In the past year, a significant achievement has been the completion of the ASEAN-India Free Trade Area with the entry into force of the ASEAN-India Agreements on Trade in Services and Investment on 1 July 2015. So far, India, Brunei Darussalam, Malaysia, Myanmar, Singapore, Viet Nam, and Thailand have ratified the Agreements. Lao PDR has ratified the Agreement on Trade in Services. We request you to use your good offices to encourage the remaining ASEAN countries to ratify the Agreement at an early date.
- Furthermore, the ASEAN-India Trade Negotiating Committee has been tasked to undertake a review of the ASEAN-India Trade in Goods Agreement, which came into effect on 1 January 2010. The review will help optimize its utilization and bring it up-to-date with today's standards.
- Negotiations on the Regional Comprehensive Economic Partnership have moved satisfactorily, with modalities being agreed in August 2015. If the technical negotiations, which are underway, are completed swiftly, RCEP may turn into a dynamic reality very soon, particularly if we simultaneously succeed in forming regional value chains and production networks. With the TPP becoming a reality, expediting RCEP is in our interest.
- Confronted with the global economic slowdown, we need to develop our common value chains and production networks. To encourage the same in CLMV countries, which comprise a special category within the ASEAN, Hon'ble PM has announced a Project Development Fund with a corpus of INR 500 crores to develop manufacturing hubs in CLMV countries.
- In order to fully utilize the potential offered by the ASEAN-India Free Trade Area, we can focus on building complementaries that can generate the necessary goodwill and trust. We need to undertake capacity building programs, workshops, and seminars that focus on the ASEAN-India FTA, Rules of Origin, services liberalization, regulatory aspects of E-Commerce, elimination of non-tariff barriers, Competition Policy and Intellectual Property Rights, SMEs cooperation and promotion. I trust that today's discussions will throw up practical recommendations in this regard.
- Our Government is keen to facilitate cross border trade between our the North Eastern States and neighboring ASEAN countries by setting up more border trade points and border hats. Under the MOU on Border Haats along the India-Myanmar border signed in 2012, it has been agreed to set up 9 Border Haats in the states of Arunachal Pradesh, Nagaland, Manipur, and Mizoram. We have two Lands Customs Stations at Tamu-Moreh in Manipur and Rhi-Zowkhathar in Mizoram, and the LCS at Moreh is being upgraded into an Integrated Check Post.
- Our efforts at promoting cross border trade at the micro-level need to supplement at the macro level by enhancing physical connectivity. We have announced a Line of Credit of US$1 billion to promote projects that support physical and digital connectivity between India and ASEAN. Along with the construction of the India-Myanmar-Thailand Trilateral Highway and the Kaladan Multimodal Project, we are also at the final stages of a Motor Vehicles Agreement between India, Myanmar, and Thailand which will address soft connectivity issues.
- Science and technology is an important component of our cooperation. We have enhanced the ASEAN-India Science and Technology Fund from US$ 1 million to US$ 5 million w.e.f. this year, which will go towards setting up of an ASEAN-India Innovation Platform to facilitate the commercialization of low-cost technologies and collaborative R&D projects. We also need to collaborate in the development of infrastructure and sustainable energy by promoting private sector cooperation in the development and utilization of renewable and alternative energy sources; clean energy technologies and energy-efficient technologies through institutional capacity building; the facilitation of trade and investment in the energy sector; and liberalization of power trade among the ASEAN Member States and India. I welcome ideas and suggestions in this regard.
- We have a session on the 'Start-up India, Stand Up India' initiative. We have announced a 19 point action plan in January this year for setting up Start-ups that would work towards innovation, development, deployment or commercialization of new products, processes or services that are driven by technology or intellectual property. I hope the session will come up with the broad contours of an ASEAN-India ecosystem to facilitate the convergence of technology, integration across diverse fields, distributed architecture, and people willing to back an idea.
- I am confident that today's Business session will provide an insight into the changes that are currently taking place in India on the investment and economic front as well as into the potential which India holds for greater engagement with the ASEAN Member States. Let us use this opportunity to collectively shape our post-2015 agenda for greater progress and prosperity of our peoples.