Issues of Philippines with Indo-Asean Services Agreement

Recently, the other countries of ASEAN group have blamed Philippines for delay, when it refused to make any meaningful offer to open up its services market to Indian professionals. Thus, the country has been playing the spoilsport in the recent India-Asean services negotiations in Indonesia. In this context, India’s Commerce and Industry Minister Anand Sharma had a bilateral meeting with his Filipino counterpart Gregory L Domingo to push India’s cause. But but Philippines did not show much flexibility.

  • The Philippines says that it had to protect its services sector as it was vulnerable and the country’s laws did not allow opening of the sector. its worth note that all other members of Asean are making offers to India for opening up their services sector, an agreement can be signed only when all countries are agreeable to the entire pact.


  • India and the Asean implemented a free trade agreement in goods in 2010, but the Asean has been dragging its feet on a services and investments agreement that was to follow.
  • India stands to gain substantially from a services agreement as there is a lot of scope for IT, healthcare, education and other professionals in the Asean countries.
  • It benefited much less from the goods agreement, as the Asean region already had low tariffs on goods and the FTA would not lead to steep reduction in duties.

Bilateral Trade:

  • Bilateral trade between the Asean and India jumped 24% in 2010 to $ 51.3 billion. India’s exports grew at 33% to $23.1 billion while imports from the Asean increased by 18% to $ 28.2 billion. Foreign direct investments (FDI) inflows from the Asean touched $14.25 billion in May 2011 and accounted for 10.36% of India’s total FDI.

India’s Deals in service till now:

  • India is negotiating bilateral deals with individual Asean countries to gain access into the Asean services market. It already has a deal with Singapore and Malaysia and is negotiating ones with Indonesia and Thailand.

ASEAN Members:

The Asean includes Brunei, Cambodia, Malaysia, Indonesia, Thailand, Vietnam, Laos, Singapore, Vietnam and the Philippines.



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