India and the 10-nation ASEAN bloc are set to start talks for opening the crucial services sector, following the signing of a Free Trade Agreement, local media reported.
“Negotiations for the free trade pact (between India and ASEAN) on services sector will begin soon,” Thailand’s Ambassador to India Krit Kraichitti was quoted by India’s The Economic Times as saying on September 20.
However, he said, given the complex nature of issues involved among India and the 10 ASEAN countries, it would take about two years for the negotiations to conclude.
According to the paper, services sector is of key interest to Indian economy as it contributes over 55 percent to the GDP. It is also emerging as an important area for export earnings for the country. But the sector faces hurdles such as harsh domestic regulations, including those relating to visa, and the complex tax regime.
Noting that the services sector is “very important” to multiply trade and investment between ASEAN countries and India, the Thai ambassador said “safeguard measures” will have to be incorporated before finalizing the pact./.