Established on 8 August 1967 in Bangkok, Thailand, with the signing of the ASEAN Declaration. Founding Fathers of ASEAN are Indonesia, Malaysia, Philippines, Singapore and Thailand. Member Countries are Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam, Australia and New Zealand. AIMS AND PURPOSES:- To accelerate the economic growth, social progress, cultural and scientific development by active collaboration and mutual assistance To promote regional peace.
Focus: ASEAN-Australia-New Zealand (Free Trade Area) On 27 Feb 2009, the trade ministers of all ten ASEAN members, Australia and New Zealand signed the Agreement Establishing the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA).
It is a geo-political and economic organization of ten countries . Covers a land area of 4.46 million km², 3% of the total land area of Earth, with a population of approximately 600 million people, 8.8% of the world population. GDP(PPP)-US$ 3,084 billion The average of economic growth of ASEAN-5 during 1989–2009 were Singapore with 6.73 percent, Malaysia 6.15 percent, Indonesia 5.16 percent, Thailand 5.02 percent and the Philippines 3.79 percent.
ASEAN has concluded free trade agreements with China (expecting bilateral trade of $500 billion by 2015), Korea, Japan, Australia, New Zealand and most recently India. The agreement with Peoples Republic of China created the ASEAN–China Free Trade Area (ACFTA)
Department of Commerce COUNTRY WISE ASEAN EXPORT Export :: Region-wise all countries Dated: 2/1/2012Region: ASEAN Values in US$ Million S.No. Country 2009-2010 2010-2011 %Growth 1 INDONESIA 3,063.36 6,245.33 103.87 2 MYANMAR 207.97 334.42 60.81 3 THAILAND 1,740.16 2,792.80 60.49 4 VIETNAM 1,838.95 2,659.56 44.62 5 CAMBODIA 45.54 63.91 40.33 6 MALAYSIA 2,835.41 3,956.98 39.56 7 SINGAPORE 7,592.17 10,302.71 35.7 8 AUSTRALIA 1,384.96 1,717.03 23.98 9 PHILIPPINES 748.77 882.74 17.89 10 BRUNEI 24.44 25.29 3.48 11 LAO PD RP 16.93 14.06 -16.94 12 NEW ZEALAND 255.17 194.00 -23.97
Department of Commerce COUNTRY WISE ASEAN IMPORT Import :: Region-wise all countries Dated: 2/1/2012Region: ASEAN Values in US$ Million S.No. Country 2009-2010 2010-2011 %Growth 1 VIETNAM 521.81 1,064.90 104.08 2 CAMBODIA 5.05 8.01 58.57 3 THAILAND 2,931.52 4,272.09 45.73 4 PHILIPPINES 313.07 429.39 37.15 5 NEW ZEALAND 499.21 625.21 25.24 6 MALAYSIA 5,176.78 6,523.58 26.02 7 INDONESIA 8,656.66 9,918.63 14.58 8 SINGAPORE 6,454.57 7,139.31 10.61 9 AUSTRALIA 12,407.37 10,789.00 -13.04 10 MYANMAR 1,289.80 1,017.67 -21.1 11 BRUNEI 428.65 234.17 -45.37 12 LAO PD RP 20.05 0.22 -98.91 Total 25,797.96 30,607.96 18.64
Department of Commerce COMMODITY WISE ASEAN EXPORT Export :: Region-wise all commodities Dated: 2/1/2012 Values in US$ Million Sorted on HSCodeRegion: ASEAN S.No. HSCode Commodity 2009-2010 2010-2011 %Growth RESIDUES AND WASTE FROM THE FOOD INDUSTRIES; 23 23 752.63 882.84 17.3 PREPARED ANIMAL FODER. MINERAL FUELS, MINERAL OILS AND PRODUCTS OF 27 27 THEIR DISTILLATION; BITUMINOUS SUBSTANCES; 4,080.74 8,286.34 103.06 MINERAL WAXES. 29 29 ORGANIC CHEMICALS 894.03 1,290.81 44.38 NATURAL OR CULTURED PEARLS,PRECIOUS OR 71 71 SEMIPRECIOUS STONES,PRE.METALS,CLAD WITH 973.29 948.26 -2.57 PRE.METAL AND ARTCLS THEREOF;IMIT.JEWLRY;COIN. NUCLEAR REACTORS, BOILERS, MACHINERY AND 83 84 919.66 1,150.05 25.05 MECHANICAL APPLIANCES; PARTS THEREOF. VEHICLES OTHER THAN RAILWAY OR TRAMWAY ROLLING 86 87 370.31 1,321.55 256.87 STOCK, AND PARTS AND ACCESSORIES THEREOF. 88 89 SHIPS, BOATS AND FLOATING STRUCTURES. 1,539.91 2,396.62 55.63
Department of Commerce COMMODITY WISE ASEAN IMPORT Import :: Region-wise all commodities Dated: 2/1/2012 Values in US$ Million Sorted on HSCodeRegion: ASEANS.No. HSCode Commodity 2009-2010 2010-2011 %Growth ANIMAL OR VEGETABLE FATS AND OILS AND THEIR 15 15 CLEAVAGE PRODUCTS; PRE. EDIBLE FATS; ANIMAL OR 4,233.83 4,766.26 12.58 VEGETABLE WAXEX. MINERAL FUELS, MINERAL OILS AND PRODUCTS OF THEIR 27 27 6,374.28 7,581.19 18.93 DISTILLATION; BITUMINOUS SUBSTANCES; MINERAL WAXES. 29 29 ORGANIC CHEMICALS 1,323.55 1,934.53 46.16 39 39 PLASTIC AND ARTICLES THEREOF. 706.45 1,100.53 55.78 NUCLEAR REACTORS, BOILERS, MACHINERY AND 83 84 2,353.14 2,775.61 17.95 MECHANICAL APPLIANCES; PARTS THEREOF. ELECTRICAL MACHINERY AND EQUIPMENT AND PARTS THEREOF; SOUND RECORDERS AND REPRODUCERS, 84 85 2,375.56 3,151.28 32.65 TELEVISION IMAGE AND SOUND RECORDERS AND REPRODUCERS,AND PARTS.
REGION – WISE SHARE OF INDIA’S EXPORT (2010-2011)
REGION – WISE SHARE OF INDIA’S IMPORT (2010-2011)
GROWTH RATE (%) IN INDIA’S TRADE WITH MAJOR REGIONS (2010-2011)
INDIA’S TRADE WITH MAJOR REGIONS OF THE WORLD (2010-2011)
Market Access Initiative (MAI)Objectives:• To promote India’s Export on sustained basis during 10th five year plan.• To evolve specific strategy for enhancement of export accessing new market or increasing share in existing market.• Specific market, specific product approach through market study/survey.Scope:• To identify priorities of research relevant to Dept. of Commerce and sponsor studies consistent with priorities;• WTO studies for evolving WTO compatible strategy• To support EPCs/Trade Promotion Organizations in undertaking market studies/survey for evolving proper strategy;• To support marketing projects abroad on Focus Product – Focus country basis.
Funded Marketing Activities-Opening of showrooms.- Opening of warehouses.- Display in international Dept. stores.- Publicity campaign and Brand promotion.- Participation in trade fair.- Research & Product development.- Reverse visits of the prominent buyers from project focus countries.- Export potential survey of the states.- Registration charges for product registration abroad for pharmaceuticals, bio- technology and agro-chemicals.- Testing charges for engineering products abroad.- Support cottage and handicrafts units.- Support recognized associations in industrial clusters for marketing aboard.
Financial AssistanceFinancial assistance may be given to:• Departments of Central Government and organization of Central/ State Governments• Export Promotion Councils• Registered Trade Promotion Organizations• Commodity Boards• Apex Trade Bodies recognized under EXIM-Policy of Government of India• Recognized Industrial clusters• Individual exporters (only for testing charges of engineering products abroad and registration charges of pharmaceuticals, bio-technology and agro-chemicals)
Marketing Development Assistance (MDA) It is operated under Department of Commerce to stimulate and diversifythe country’s export trade, through below mentioned activities:(i) Assist exporters for export promotion activities abroad.(ii) Assist Export Promotion Councils (EPCs) to undertake export promotion activitiesfor their product(s) and commodities.(iii) Assist approved organizations/trade bodies in undertaking exclusivenonrecurring innovative activities connected with export promotion efforts for theirmembers.(iv) Assist Focus export promotion programmes in specific regions broad like Focus(LAC), Focus (Africa), Focus (CIS) and Focus (ASEAN + 2) programmes.(v) Residual essential activities connected with marketing promotion efforts abroad.
Eligible activities under Focus Area ProgramsS.No. Permissible items of expenditure under Percentage of funding under MDA MDA 1. Participation in International Fairs/exhibitions organized As applicable in non-focus area with by EPCs etc. ceiling of Rs. 10 lakhs. Sponsoring BSMs/Trade delegations abroad by EPCs etc. 2. Reverse trade visits of prominent foreign buyer / delegates / journalists to India for participation in BSMs/exhibitions etc. i) Return air-fare travel expenses in economy excursion i) 100% (subject to a ceiling of Rs. class upto the entry point in India. 60,000/- ii) Venue charges (ii)&(iii) As applicable in non-focus area iii) All other organizing expenditure with ceiling of Rs. 10 lakhs. All other expenses relating to stay, per diem allowance, local travel etc. of delegates invited from abroad are to be met by the EPC or by sharing between the organizers and delegates. 3. Translation facilities in foreign languages and vice versa. 60% 4. Product catalogue in CD ROM 60%
INDIA & ASEAN India became a sectoral dialogue partner of ASEAN in 1992. In August 2009, India signed a Free Trade Agreement (FTA) with the ASEAN members in Thailand. India’s trade with ASEAN countries has increased from US$ 30.7 billion in 2006-07 to US$ 45.34 billion in 2009-10. Singapore continues to be the single largest investor in India amongst the ASEAN countries with foreign direct investment (FDI) inflows into India, totaling US$ 2.4 billion in 2009-10.
Singapore total exports into India was US$ 10,302.71 million in the year 2010-11, an increase of 30.48% as compared to year 2009-10, comprising mainly of mineral fuels and oils, ships, boats and floating structures and natural pearls, gems and jewelry. In case of imports it was US$ 9,918.63 million in the year 2010-11 which shows an increase of 10.6 % as compared to year 2009-10. Indonesia is the second largest FDI investor amongst the ASEAN countries. FDI inflows from Indonesia into India was US$ 604.28 million during April 2000-March 2010. Thailand FDI inflow during the period April 2000-March 2010 into India was US$ 77.97 million. Myanmar FDI inflows into India totaled US$ 8.96 million in the period April 2000-March 2010.
INDIA ASEAN TRADE• Asia and ASEAN region is India’s largest trading partner. During the period April- September 2010-11, Asia and ASEAN region accounted for about 58% of India’s trade (exports and imports). Europe and America, together, account for around 31% of India’s trade.• Major Commodities of Export & Import – ASEANThe Principal Commodities of export include : Petroleum Products, Oil Meals, Gem and Jewellery, Electronic Goods, Cotton Yarn/RMG Cotton, Machinery and Instruments, etc.The major commodities imported from this region are: Coal/Coke/Briquettes, Vegetable oils, Petroleum Oils, Electronic Goods, Organic Chemicals, Machinery except Electrical Machinery, etc.
Export House/Trading House Certification• The objective of the scheme is to recognise established exporters as Export House, Trading House, Star Trading House and Super Star Trading House with a view to build marketing infrastructure and expertise required for export promotion.• Merchant as well as Manufacturer exporters, service providers, Export Oriented Units (EOUs)/ units located in Export Processing Zones (EPZs)/ Electronic Hardware Technology Parks (EHTPs)/ Software Technology Parks (STPs) shall be eligible for such recognition.
• The eligibility criterion for such recognition shall be either on the basis of the FOB/Net Foreign Exchange (NFE) value of export of goods and services, including software exports made directly as well as services.• The exports made by a subsidiary of a limited company shall be counted towards export performance of the limited company for the purpose of recognition. For this purpose, the company shall have the majority share holding in the subsidiary company.
ZERO DUTY EPCG SCHEME• The scheme has been introduced in the new Foreign Trade Policy 2009-14 for specified sectors.• New sectors included under zero duty EPCG Scheme w.e.f 23.08.2010 are paper & paperboard and articles thereof, ceramic products, glass & glassware, rubber & articles thereof, plywood and allied products, marine products, sports goods and toys added.• Validity is for 9 months , export obligation is of 6 years and can be extended to 2 years only.
Favorable Factors Low wages. High productivity growth. Diverse production conditions. Proximity to large Asian markets. Regions liberalising trade policy agreements.
Non Favorable Factors Shortage of skilled labor & professionals. Inadequate physical & institutional infrastructure ( such asRoads & transportation facilities , communication , tradefacilitation measures , Intellectual property rights protectionmeasures). Lack of developed system for setting product standards &conformity assessment procedures. Volatility in exchange rates.
Computer ComponentsWhile the ASEAN region is the world’s second largestexporter of computer components, it faces a major challengefrom China. Cotton Woven ApparelTariff reductions have helped facilitate a small but growingamount of integrated production of cotton woven apparelamong ASEAN countries. However, trade programs such asfree trade agreements have more heavily influenced regionalintegration.
Hardwood Plywood and FlooringAccess to legally sourced and sustainable woodsupplies is an important competitive factor affectingintegration, export competitiveness, and inboundinvestment in the ASEAN hardwood plywood andflooring industry. Healthcare ServicesGrowth of private healthcare firms in the ASEANmarket has generated increased trade andinvestment in healthcare services.
Motor Vehicle PartsASEAN has been successful at meeting criticalRoadmap targets and facilitating regional integrationwithin the automotive sector. Despite theseachievements, the regional automotive industry andmarket have yet to fully integrate.Palm OilThe Roadmap for Integration of Agro-based Productshas had far less impact on the structure of the ASEANpalm oil industry than have multinational corp. andinternational groups.
CHINA A THREAT TO ASEAN COUNTRIESChina is a major competitor of ASEAN countries inattracting foreign investment and in integratingregional production chains. However, ASEANrecently concluded an FTA with China, becauseChina has become an important hub in Asian supplychains. ASEAN countries hope the FTA will offerbetter opportunities to participate in these networks.ASEAN offers an alternative production location toChina for multinational firms wanting to diversifytheir operations to reduce business and politicalrisks.
• Brunei Darussalam October 10, 1995• Cambodia December 31, 1969• Indonesia April 15, 1954• Lao Peoples Democratic Republic (Laos) July 5, 1961• Malaysia March 7, 1958• Myanmar (Burma) January 3, 1952• Philippines December 27, 1945• Singapore August 3, 1966• Thailand (Siam) May 3, 1949• Vietnam Sept. 21, 1956 Source: www.imf.org
• Brunei Darussalam Oct 10, 1995• Cambodia Jul 22, 1970• Indonesia Apr 13, 1967• Lao Peoples Democratic Republic Jul 5, 1961• Malaysia Mar 7, 1958• Myanmar Jan 3, 1952• Philippines Dec 27, 1945• Singapore Aug 3, 1966• Thailand May 3, 1949• Vietnam Sep 21, 1956
WTO MEMBERS• Brunei Darussalam January 1, 1995• Cambodia October 13, 2004• Indonesia January 1, 1995• Lao Peoples Democratic Republic February 19. 1998 (Observer Government)• Malaysia January 1, 1995• Myanmar (Burma) January 1, 1995• Philippines January 1, 1995• Singapore January 1, 1995• Thailand January 1, 1995• Vietnam January 11, 2007
RECENT NEWS ARTICLES “ADB to tie up with India and China for ASEANInfrastructure Fund”Multilateral funding agency, Asian Development Bank(ADB), is keen to rope in India and China in the newlycreated Association of Southeast Asian Nations (ASEAN)Infrastructure Fund for funding infrastructure projects in theregion. Jan 21, 2012, www.business-standard.com
“ASEAN, World Bank reaffirms partnership” The World Bank has reaffirmed its support for ASEANs economic integration, particularly at a time when the Asia-Pacific region is rapidly expanding, a press statement from the ASEAN Secretariat said. February 09, 2012, www.asean-society.org
“Better job scope for Indian pros in Asean countries” Come next financial year, and India and Asean (Association of Southeast Asian Nations) are set to facilitate an easier and more regular movement of professionals between them. The agreement is expected to open up greater job opportunities for Indian professionals in the IT, healthcare, designing, research and other sectors. Feb 19, 2012, www.business-standard.com