Trade Agreements Between India and Thailand: A Comprehensive Guide
The bilateral trade relationship between India and Thailand has been growing stronger over the years. With both countries being emerging markets, there is a lot of potential for further collaboration and increased trade. In this article, we will explore the various trade agreements between India and Thailand, and how they are benefiting both nations.
Free Trade Agreement
In 2004, the India-Thailand Free Trade Agreement (FTA) was signed to increase bilateral trade and economic cooperation between the two countries. Under the FTA, both countries agreed to eliminate tariffs on a wide range of products, including agricultural goods, chemicals, textiles, and machinery. The agreement also includes provisions for the protection of intellectual property rights.
Since the implementation of the agreement, bilateral trade between India and Thailand has grown significantly. In the fiscal year 2019-2020, the total trade volume was estimated to be around $12.5 billion, with India exporting goods worth $3.9 billion to Thailand, and importing goods worth $8.6 billion from Thailand.
Moreover, the FTA has provided opportunities for Indian businesses to expand their presence in the Thai market. Indian companies have invested in various industries in Thailand, including automotive, pharmaceuticals, and IT, among others.
Regional Comprehensive Economic Partnership
The Regional Comprehensive Economic Partnership (RCEP) is a free trade agreement that was signed by 15 nations in November 2020. The agreement includes the ten ASEAN countries (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam), as well as Australia, China, Japan, New Zealand, and South Korea.
The RCEP is expected to become the largest free trade agreement in the world, covering approximately 30% of the global population and GDP. The agreement aims to reduce tariffs and non-tariff barriers to trade, promote investment, and enhance regional economic integration.
For India, the RCEP provides an opportunity to increase its trade ties with the ASEAN countries, including Thailand. However, India opted out of the agreement due to concerns about the impact it would have on its domestic industries. Despite India`s absence, the RCEP is expected to benefit Thailand by providing access to new markets and expanding the country`s trade opportunities.
The trade agreements between India and Thailand have created a favorable environment for increased bilateral trade and investment. The India-Thailand FTA has played a crucial role in boosting trade between the two countries, while the RCEP has the potential to further enhance regional economic integration.
As both countries continue to develop, there is no doubt that their trade relationship will become even more important in the future. By leveraging their respective strengths and resources, India and Thailand can create a mutually beneficial partnership that will contribute to their economic growth and prosperity.