New Delhi, Feb 18 (IANS) India and Malaysia Friday signed a comprehensive economic cooperation agreement (CECA), which opens higher level of foreign direct investment (FDI) for India in key sectors.
The agreement has also set a target to increase bilateral trade to $15 billion by 2015.
Indian Commerce and Industry Minister Anand Sharma and Malaysia’s Minister for International Trade and Industry Mustapa Mohamed signed the agreement in Kuala Lumpur in the presence of Malaysian Prime Minister Mohd Najib Razak, according to an official statement released here.
The agreement will come into force July 1 and the first review will be held within a year.
The agreement is comprehensive and ambitious and envisages liberal trade in goods and services and a stable and competitive investment regime to promote foreign investment between the two countries, the ministry of commerce and industry said in the statement.
The goods package under the CECA takes the tariff liberalisation beyond the India- ASEAN free trade agreement commitments on items of mutual interest for both the countries.
Malaysia is the third largest trading partner of India amongst the Association of South East Asian Nations (ASEAN) countries.
India-Malaysia bilateral trade was $9.03 billion in 2010. It reached a peak of $10.65 billion in 2008.
Sharma said the deal would help increase bilateral trade to over $15 billion by 2015.
Under the agreement, India will get access in the Malaysian market for goods including fruits such as mangoes, banana and guava, basmati rice, two-wheelers and cotton garments.
Also, service sectors like accounting and auditing, architecture, urban planning, engineering services, medical and dental, IT and IT-enabled services, and management consulting services will get access in the Malaysian market.
Malaysia has offered comparatively higher level of foreign direct investment in key sectors of interest to India such as construction services (51 percent), computer and related services (100 percent) and management and consultancy services (100 percent).
This is a significant concession provided under the agreement as Malaysia mandates 30 percent equity participation by local companies in most of its industries.
