The comprehensive trade pact between India and Japan, which aims to nearly double bilateral trade to $25 billion by 2014, came into force from Monday.
As per the agreement, Japan will immediately eliminate duties on 87 per cent of its tariff lines, a Commerce Ministry statement said.
Most of these items form part of India's export basket to Japan. These include seafood, agricultural products such as mangoes, citrus fruits, spices, instant tea, spirits such as rum, whiskies and vodka, textile products such as woven fabrics, yarns, synthetic yarn, readymade garments, petro chemical and chemical products, cement, and jewellery.
The Comprehensive Economic Partnership Agreement will also boost Indian pharmaceutical exports to Japan, as Japan is mandated to treat Indian drug firms on par with Japanese companies under the terms of the deal. .
Besides, the agreement will enable Indian IT professionals to provide services and further develop Japan's IT industry. Besides contractual service suppliers, independent professionals (accounting, R&D services, tourist guides, market research and management consulting firms) will now be able to offer their services in Japan. Japan has also agreed to conclude a Social Security Agreement within a specified period of three years.
Under the social security deal, India will benefit from Japanese investments, technology and world-class management practices, the official statement said. Japan can take advantage of India's huge and growing market and resources, especially its human resources, it added.
Commerce Secretary, Dr Rahul Khullar, said the pact was a major step in the direction of a comprehensive East Asia partnership. He was speaking after co-chairing the first meeting of the Joint Committee of India-Japan CEPA with Mr Akitaka Saiki, the Japanese Ambassador, here on Monday. This is India's third CEPA (after similar pacts with Singapore and South Korea) , the statement said.
Under the pact, India has offered to eliminate duties on only 17.4 per cent of its tariff-lines, the statement said. Tariffs will be brought down to zero in 10 years on 66.32 per cent of tariff lines to give sufficient time to industry to adjust to the trade liberalisation, it added.
arun.s@thehindu.co.in