A free trade deal with ASEAN member states has strategic importance to India since the country exports 12 percent to these states and imports 10 percent. The FTA is expected to increase the trade from the current $40bn to $50bn by next year.

Indian officials said that there were plans to even sign the India-South Korea Comprehensive Economic Partnership Agreement (CEPA) along with the ASEAN FTA. The South Korean representatives are expected to attend the upcoming summit to engage in talks with the ASEAN members as well as concluding the formalities on CEPA with India.

Both trade deals require Indian cabinet approval, and would be the first such approval by the United Progressive Alliance after returning to power consecutively for the second time. The FTA had earlier missed the April date due to parliamentary elections in India.

The talks between India and ASEAN were stalled several times as the association insisted on cuts in tariff twice a year. But in the recent talks, India was able to convince the ASEAN members on duty cuts once in twelve months, and the same will be reviewed every January. As per the deal, duty to be cut for the highly sensitive products including tea, coffee, pepper, crude and refined palm oil is between 30 and 45 percent by Dec 31, 2019.

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The summit happens to be the first forum after the North Korean satellite launch which has been widely criticized by Japan, South Korea and the western world as an attempt to test its ballistic prowess. As a result, many ASEAN members are concerned about the summit getting reduced to a forum for finding ways to penalise N. Korea for their action rather than meeting region’s economic problems. Earlier, despite the US and its allies headlining the Korea’s satellite launch as rocket launch and urging the UN to impose sanctions, China and Russia had called for patience.

The ASEAN summit was originally planned for last December and postponed with two phases in late February and April respectively this year due to anti-government protests that shut down Bangkok’s main international airport for several days during the scheduled period. Usually the summit is an annual gathering of representatives or leaders from ASEAN group, but the global economic crisis have compelled the group to include the economic powerhouses of the region in the forthcoming summit.

According to sources, the Australian prime minister, Kevin Rudd will once again appeal the participants to review his proposal in last May for an Asia-Pacific Union (APU) in the line of the EU. Rudd’s proposed APU member states account for more than half the population of the world and is worth about half the global economic output. His call is likely to have more takers this time around since the summit has plans to formally denounce any form of protectionism to tide over the current economic mess quickly.

The ASEAN leaders will make sure that the focus is on climate change, which dominated the last summit, will be followed by trade, energy, food security and disaster management. They also hope the meet will include the finer points of the recently concluded G20 Summit to aid struggling economies get out of the present economic quagmire left behind by the global financial and economic crisis.

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