Trade pact review: India, ASEAN exchange proposals on last-mile issues
Senior ASEAN officials have been quoted in local media reports stating that the bloc acknowledged these issues, and was utilising the AITIGA review negotiations to address implementation issues and trade concerns
India has asked the ten-member ASEAN to finalise its position on New Delhi’s counter proposal on outstanding issues–focussed on bridging its widening trade deficit with the bloc–as part of the ongoing review of the free trade agreement. The review is to be “substantially concluded” by the year-end, sources have said.
New Delhi is aiming for more balanced gains with greater market openings in member-countries like Indonesia, Vietnam, Thailand and Cambodia for items such as agricultural products, vehicles and pharmaceuticals, a source tracking the matter said.
Both sides want to substantially conclude the free trade pact, called the ASEAN-India trade in goods agreement (AITIGA), by end-2025 and an announcement to this extent may be made at the ASEAN-India Summit in Kuala Lumpur later this month.
“After the last joint committee meeting in August this year in Delhi, the ASEAN shared its package/proposal on outstanding issues. After internal consultation, India reverted with its counter proposal. India’s counter proposal is under active consideration by ASEAN side,” an official said.
Counter proposal
India’s counter proposal is mainly focussed on measures to bring down its trade deficit with the ASEAN, which increased to $45.2 billion in FY 25 from about $7 billion in 2010 when the AITIGA was implemented. Lower tariff reduction commitments given by some members like Thailand and Vietnam and poor utilisation of the FTA by Indian exporters, at 30-40 per cent or lesser, are among the main reasons for the deficit.
The ASEAN, which includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam, wants to explore new areas of collaboration and growth such as digital economy, green economy and deepening of supply chains.
The ten-member bloc has also recognised India’s concerns on the increasing trade deficit, the existing non-tariff barriers, and the rules of origin enforcement, the official said. New Delhi is especially worried about influx of cheap Chinese goods through the ASEAN countries, misusing the pact.
Senior ASEAN officials have been quoted in local media reports stating that the bloc acknowledged these issues, and was utilising the AITIGA review negotiations to address implementation issues and trade concerns.
At the 13th East Asia Summit – Economic Ministers Meeting (EAS) in Kuala Lumpur last month, India highlighted the need to ensure fair, înclusive, non-discriminatory, open, equitable and rules-based transparent multilateral trading system with the WTO at its core. At the ASEAN-India Economic Ministers consultation (AEM) held simultaneously, India also asked the bloc to finalise its position on New Delhi’s counter-proposal on the trade pact review, the official said.
Published on October 19, 2025
