Associated Chambers of Commerce and Industry of India organized a National conference on “The impact of Free Trade Agreements on the Indian Economy”. The Conference was organized in the Napoleon Hall of Hotel Le Meridien on April 5, 2010.

The conference started with a welcome address by the President of ASSOCHAM Dr. (Mrs) Swati Piramal who welcomed all the delegates of the conference and outlined the agenda for the day. Mr. Sajjan Jindal and Mr. V.N. Dhoot –past presidents of ASSOCHAM delivered the theme address and address followed by the key note address by Dr. Rahul Khullar-Secretary Department of commerce. The key issues that were talked about were the Rationale and Feasibility of Free Trade Agreements, Mechanism for The Implementation and Application of Free Trade Agreements and the impact of FTA’s on Foreign direct investment (FDI) and on the economy of India.

Then Mr. Anand Sharma, Hon’ble Union Minister of Commerce and Industry delivered an Inaugural address to the delegates. He informed the delegates about the new Foreign direct investment rules that have been framed to facilitate more FDI in order to boost infrastructure development and eventually the GDP. He stated that the new FDI rules have defined the concepts of ownership and control with clarity. He ruled out any changes in the FDI rules for Private Banks. According to the rules, if a company has more than 51% foreign stake it would be treated as a foreign company. To cite an example he said that HDFC Bank and ICICI Bank would be treated as foreign entities as more than 51% of their ownership lies with overseas investors, thereby transforming them into foreign entities. Talking about FTA’s with ASEAN( Association of South East Asian Nations), the minister informed the delegates about the recent developments in this regard, adding that further trade negotiations were going on which would be concluded by August 2010. The outcome of these trade negotiations would be of immense interest to all the Indian Professionals especially in the Engineering & Architecture, Banking, Finance and Insurance sectors. The minister said that the trade between ASEAN and India is expected to increase from 44 billion US dollars to 50 billion US dollars by the end of 2010.
The Hon’ble Union Minister left the conference after a vote of thanks by Mr. Dilip Modi, Senior Vice President ASSOCHAM.

Panel Discussion on “FTA’s: Impact on Indian Economy” was held after the departure of the Minister.
Mr Amarendra Khatua, Joint Secretary Department of commerce & Industry chaired the Panel Discussion.
Panelists were :-
Dr. (Smt) Vijaya Katti –Professor & Chairperson, IIFT
Mr. Manoj Madhusadanan -Vice President, Evalueserve
Mr. K.C. Mehra – Resident Director Shapoorji Pallonji Group
Mr. T. S. Vishwanathan, Principal Advisor – Trade Policy, APJ-SLG Law

The discussion was started with a purview of the current scenario of FTA & RTA’s (Regional Trade Agreements) and the importance of FTA/RTA’s in international and bilateral trade with other countries. Panelists pointed out the need for the trade organizations to be positive about the FTA and not to view them with suspicion.  Mr.Khatua stressed the need of FTA’s to boost the economy of the nation. Mr. Khatua brought to the notice of the delegates the work done by the Ministry of commerce and Industry. He said that till 1993 India had signed only three (03) FTA and as of today ten (10) FTA’s have been signed with various countries. The ministry is in negotiations with nineteen (19) more countries and nine FTA’s are in the pipeline. The foreign trade with the EU alone is seventy eight (78) billion Euros which is growing at the rate of 60-70% per year. Mr. Manoj Mahdusudanan said that there is a need to change the laws in our country which will promote free trade and also to ensure formal employment so as to encourage tax payment by all the employees. It was pointed that 80-90% employment in India is informal which results in loss of tax by the govt. The need of the hour is to have a uniform and transparent tax code to encourage more people opting for formal and organized employment and hence boost tax collections which is very important for improving GDP and trade.

The panel discussion was concluded after a brief Q&A session which was quite interactive and interesting. The conference was followed by Lunch.