The free trade agreement between India and Thailand will result in significant creation of business as a result of increase in the level of two-way trade between the two countries, analysts said in Bangkok on Thursday.
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The first phase of an agreement will help the two countries trade freely in machinery, precious stones, jewelry and electrical appliances, officials at the India-Thai Chamber of Commerce said.
Thailand and India plan to cut tariffs on a number of goods to zero by 1010.
Thai investments approved in India during 2000 and 2001 were $0.1 million and $0.3 million, respectively. The cumulative inflow of FDI from Thailand as on May 31, 2002 was $66.2 million.
Thailand ranks 18th among the foreign countries and third among ASEAN in terms of investment approvals during 1991 to December 2002 with India.
In 2002, bilateral trade between India and Thailand increased by 2.66 per cent over 2001 to reach $1184.8 million. Indian exports registered an increase of 14.92 per cent whereas Thailand's exports declined by 14.36 per cent over 2001.
A significant increase in terms of value has been on Indian exports of metals and waste scrap (219.44 per cent) and industrial use machines (55.46 per cent) compared with the same period in 2001.
However, there was a decrease in value in export items like electrical machinery and parts, and vegetable fats and oils.
At present there are 26 joint ventures between the two countries. The major Indian groups here are Aditya Birla Group, Ballarpur Industries, Baroda Rayon Group, Usha Martin Industries, Ranbaxy Laboratories, Lupin Laboratories and Indo-Rama.
According to the Indo-Thai Chamber of Commerce, the potential areas for Indian investment in Thailand include information technology, pharmaceuticals, herbal-based medicines and cosmetics, dairy development and products, space technology, biotechnology and biomass projects, manufacturing of machine tools, medical supplies and instruments, transport and equipment.
