ASEAN TREATY AND ITS IMPACT ON FARMERS IN KERALA

THE FLAG OF ASEAN

THE ASEAN MAP

An Overview
ESTABLISHMENT  Established on 8th August 1967 in Bangok  Original Member Countries Indonesia Malaysia Philippines Singapore Thailand

AIMS AND PURPOSES

1.

2.

To accelerate economic growth, social progress and cultural development in the region To promote regional peace and stability through abiding respect for justice and the rule of law in the relationship among countries in the region and adherence to the principles of the United Nations Charter

VISION OF ASEAN Outward looking Living in peace Stability and Prosperity Bounded together in partnership in dynamic development and in a community of caring societies

FUNDAMENTAL PRINCIPLES
ASEAN Member Countries have adopted the following fundamental principles in their relations with one another, as contained in the Treaty of Amity and Cooperation in Southeast Asia (TAC): mutual respect for the independence, sovereignty, equality, territorial integrity, and national identity of all nations; the right of every State to lead its national existence free from external interference, subversion or coercion; non-interference in the internal affairs of one another; settlement of differences or disputes by peaceful manner; renunciation of the threat or use of force; and effective cooperation among themselves.

MEMBER COUNTRIES
Brunei Darussalam Cambodia Indonesia Lao PDR Malaysia Myanmar The Philippines Singapore Thailand Vietnam

ASEAN FREE TRADE AREAS

Australia Free Trade Area New Zealand Free Trade Area China Free Trade Area India Free Trade Area Japan Free Trade Area Republic of Korea Free Trade Area

Asean India Free Trade Agreement

AGREEMENT WITH INDIA

The India-Asean FTA has finally been signed on August 13, 2009. Under the initial bilateral framework agreement signed in Bali on October 8, 2003, the FTA was supposed to have been finalised by June 30, 2005. A deal was finally concluded on August 28, 2008 After a series of missed deadlines, the FTA was signed during the 41st Asean Economic Ministers Meeting (AEM) on August 13, 2009, in Bangkok, amidst concerns and protests from the Indian farm lobby, compliant legislators within the Cabinet, State Governments and NGOs.

IMPACT ON FARMERS

LISTING OF PRODUCTS
Ordinary Products Sensitive Products Highly Sensitive Products(critical items): 5 products namely crude palm oil, refined palm oil, coffee, black tea and pepper Special Products Negative Products (Exclusion Products): 489 items come under this list. India is the only country which has a negative list incorporated in a trade pact with Asean

The negative list includes 303 items of the agriculture sector including coconut, natural rubber, cashew nuts, cardamom, Sardine, prawns, etc. 81 of textile 50 of automobiles 17 items of the chemical sector But the agreement also gives a condition that the items will be reviewed each year.

Inclusion list 4000 items are included. A gradual elimination of duties on items which account for 75 per cent of the trade between India and ASEAN. These include electronics, textile, machine, and chemical goods. Several varieties of tuna fish, Pearl Spot, are included under inclusion list. Within 10 years the tariff rates of these products will be reduced to half or more than half of the prevailing rates.

Problems
When the tariff rates of agricultural products are reduced imports will be higher and that would lead price reduction in the country Majority of the products come under inclusion list, which advocates complete reduction in tariff, the farmers in the state are in worry. The import duty of about 80% products-including agricultural products- that these countries export to India would enjoy near zero import tariffs. Cheap imports from the Asean region would hurt domestic growers of tea, coffee, cashew, coconut, oil palm, rubber, spices and other plantation items. The FTA, which will come into force in January 2010, will phase off the import tariff of about 320 products by 2013. Tariffs on an additional 800 products would be brought down to zero or near zero levels by December 2016

With the ASEAN's FTA, any country, especially countries like Australia, who already have an FTA with the ASEAN, can use those countries as transit points to export products like wheat to India, by bypassing tariff payments. Many of the ASEAN countries share the same climatic conditions as of Kerala, which means those countries produce more or less same crops as the Kerala farmers. Kerala was always famous for its spices. But today, countries like Vietnam took over the prime position in international spice markets. Kerala spices can no longer fight with the cheap produces from these countries. They have clear advantages, both in labor cost and productivity.

Even a minor price fluctuations in rubber would lead to a drastic breakage of the existing economic system.

Advantages
The agreement will provide additional market access to Indian exporters, fuelling a growth in bilateral trade and investment, especially those dealing in machinery, steel, agriculture products, auto components, chemicals, and synthetic textiles. Indian manufacturers will be able to source products from overseas at competitive prices from the ASEAN members. Indian consumers can get products at cheaper rates.

ANNEXURES

Asean Summit

Protests against Asean

Posters of Protest

THANK YOU