The government is currently reviewing Free Trade Agreements that India has signed with trading partners after the industry voiced concerns about benefits of these pacts for domestic players. These agreements have been signed with several countries, including Asean bloc of nations, Japan and Korea. It is also negotiating similar pacts with several regions, including the European Union, Australia, New Zealand and Canada.
However, a second review of the CECA has remained inconclusive over the past six years.
Recently a Finance Ministry report looking at persisting problems in stagnant exports had said the same thing. Rather than exporting that which is available domestically, it had urged the government to consider shifting to items for which there is world demand and India enjoys basic competence.
“In 2015, India’s export share in the top 100 world import items at four-digit HS level were more than five per cent in only five items,” it had said. This represents only 1.6 per cent in value terms.
Also pointed out, has been the low participation of Indian companies in the supply chains which have come up in the area with Singapore being a hub.
Among all Asian nations, India's services trade is also highest with Singapore, which is a world leader in the field. On that note, the lack of mutual recognition agreements (MRA) - whereby countries agree to recognize one another's conformity assessments - in crucial sectors have hit India's services exports, the RIS report points out.
The issue has become a fulcrum of other trade talks that India is currently engaged in such as the Regional Comprehensive Economic Agreement (RCEP) since the nation has significant strength in the fields of Architecture, Medical, Dental, Nursing and Chartered Accountancy, among others.
According to government figures, Singapore is the third largest foreign investor in India whereas Singapore received the highest outflow of Indian FDI.