Indo-Thai FTA to cover services too

NEW DELHI: India and Thailand are planning to expand their limited free-trade agreement (FTA), which includes just 82 items, to services and investments, Thailand's deputy PM Korbsak Sabhavafu has said.

"At present, both the countries are engaged in lifting the free-trade agreement into a comprehensive pact to include services and investments," Mr Korbsak said at a meeting organised by FICCI on Wednesday.

The deputy PM said that expanding commercial ties could push up bilateral trade from $ 6 billion at present to $10 billion in 2011.

India and Thailand signed an early harvest programme which was supposed to be followed by a full fledged free trade agreement (FTA) in 2004. Under the EHP, the two sides eliminated duties on 82 items, both agricultural and industrial, like television tubes, refrigerators, mangoes, apples grapes and some metals.

The FTA was, however, not signed because of disagreements related to the rules of origin (the rules which determine which products are to be considered as originating from the partner country and which are to be considered as originating from a third country) and political instability in Thailand.

However, Thailand now seems confident about concluding a comprehensive agreement soon. "We can get it done very quickly," Mr Korbsak said.

Thailand is also part of the ten-member ASEAN which signed a free trade agreement on goods with India this year. The FTA, which seeks to eliminate duties on more than 4,000 items over the next eight years, is scheduled to be implemented from January 1 2009.