Thailand Regarded as a Regional Hub for Indian Investment in ASEAN

Indian business people have shown interest in Thailand as an attractive destination and regional hub for Indian investment in ASEAN. A greater flow of investments between Thailand and India are seen in the near future.

Deputy Prime Minister Korbsak Sabhavasu and Vice Minister of Foreign Affairs Panich Vikitsreth, accompanied by representatives from the public and private sectors, paid a two-day visit to India on October 7-8 for a road show.

In his keynote address at the India-Thailand Business Forum on Trade, Investment, and Tourism, held in New Delhi, Mr. Korbsak said that he believed that India’s “Look East” policy and Thailand’s “Look West” policy would help improve economic cooperation between the two nations. He suggested that India and Thailand seek new business opportunities and supplement each other in enlarging their markets.

Trade between Thailand and India came to six billion US dollars in 2008. Both countries have set a target to increase bilateral trade to 10 billion dollars in 2011. The trade balance has been in Thailand’s favor. The Thailand-India Free Trade Agreement (FTA) Framework was signed on 9 October 2003, covering trade in goods, services, and investment, as well as economic cooperation between the two countries. It will complement the ASEAN-India FTA, which was signed on 13 August 2009 during the 41st ASEAN Economic Ministers Meeting in Bangkok. This FTA, or the Trade in Goods Agreement, will lead to tariff reduction for more than 4,700 categories of products, starting from 1 January 2010.

Mr. Korbsak said that the ASEAN-India FTA would create a new free trade area of 1.7 billion people, comprising 580 million people in the 10 ASEAN members and about 1.13 billion people in India. With the strategic location of Thailand and its bilateral and regional FTAs with India, Indian enterprises could enjoy access to the ASEAN market.

He also proposed closer cooperation between the two countries in the field of tourism by linking the “Amazing Thailand, Amazing Value” and “Incredible India” tourism promotion campaigns. Moreover, he said, Thailand has good potential for producing ethanol from agricultural crops as an alternative energy source in response to India’s energy needs.

In his talks with the Indian Minister for Development of the Northeaster Region, Mr. B.K. Handique, and the Minister of Road Transport and Highways, Mr. Kamal Nath, Deputy Prime Minister Korbsak discussed the possibility of Thai companies investing in the Indian government’s basic infrastructure projects, which are valued at 70 billion dollars over the next three to four years.

Indian Prime Minister Manmohan Singh is scheduled to visit Thailand in late October 2009 to attend the 15th ASEAN Summit and Related Summits, while Prime Minister Abhisit Vejjajiva is scheduled to visit India in December this year.