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India-Malaysia FTA comes into force

FTA with Japan likely from 1st August

India signed a Comprehensive Economic Co-Operation Agreement (CECA) with Malaysia and a Comprehensive Economic Partnership Agreement with Japan (CEPA) in February, 2011. Both agreements have been the product of intensive negotiations following reports of the two mutual Joint Study Groups (JSG’s) set up in 2005.

Put together, the CEPA and CECA aim to reduce tariffs on more than 90 per cent of the goods that India trades with Japan and Malaysia in staggered instalments over the next ten years. However, though both agreements contain detailed provisions liberalizing investment, goods and services they remain relatively mute with respect to intellectual property.

The benefits under the agreements shall be best appreciated in sectors such as agriculture, textile, seafood, pharmaceutical products, accounting and auditing, architecture, urban planning, engineering services, medical and dental, IT & ITES and Management Consulting Services.

The CECA has been notified on July 1, 2011 along with corresponding rules of origin while it is expected that the CEPA will be notified on August 1, 2011.

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