Japan, India to Sign Free Trade Agreement

Japan and India will sign a free trade agreement Wednesday to eliminate import tariffs on most products traded between the two giant Asian economies, the Japanese government announced Tuesday.

The FTA, which is formally called the Comprehensive Economic Partnership Agreement between Japan and the Republic of India, will be signed in Tokyo by Japanese Foreign Minister Seiji Maehara and Indian Commerce and Industry Minister Anand Sharma.

The signing comes after about four years of negotiations. The Japan-India FTA will eliminate import tariffs on about 94 percent of bilateral trade by value within 10 years.

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The Japan-India FTA is expected to "promote the liberalization and facilitation of trade and investment between the two countries" and "further vitalize both economies by strengthening reciprocal economic ties in wide-ranging fields," the Japanese government said in a statement.

Japan and India are now Asia's second- and third-largest economies after China. Last In 2010, Japan lost to China its much-vaunted status as the world's second-biggest economy after the United States, which it had kept for 42 years.

According to Japanese government figures, Japan exported $7.2 billion worth of products to India and imported $4.2 billion worth of goods from the South Asian country in 2009.

For Japan, the FTA with India will be the 12th such trade pact. Japan has so far signed FTAs with 10 countries -- Singapore, Mexico, Malaysia, Chile, Thailand, Indonesia, Brunei, the Philippines, Switzerland and Vietnam – and with the 10-member Association of Southeast Asian Nations.

ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

For Japan, the FTA with India will be the first such trade pact since the Democratic Party of Japan took power following a landslide victory in general elections in August 2009.

-- Contact Hisane Masaki at yiu45535@nifty.com.