This update is an attempt to map India`s contribution to the various FTA spaghetti strings that run through Asia and other parts of the world. We listed all the agreements that India has concluded with a brief note on the progress of work and provided more details on six important free trade agreements. More detailed documents on agreements such as SAFTA, the EU-India Trade and Investment Agreement and the ASEAN-India Regional Trade and Investment Agreement will follow in the coming months. Ministry of Commerce website, Regional/Bilateral Trade Agreements, Indo Sri Lanka Free Trade Agreement (ISFTA): www.doc.gov.lk/regionaltrade.php?mode=inop&link=isfta SAFTA entered into force in early 2006 and its current mandate is to remove barriers to agriculture and trade in production goods between Member States. The agreement provides for progressive reductions in customs duties for goods for a period of ten years, with the exception of those on the sensitive list. The tariff reduction liberalization program includes about 5,500 tariff lines (agriculture and industrial products). Negotiations on the sensitive list are ongoing, with Pakistan with 1183 products, Sri Lanka 867 products, Bangladesh 1254 and India 86720. Some countries, such as India and Bangladesh, also have another set of sensitive lists for least developed countries21 (LDCs) in the group. Unfortunately, Indian investments are banned in Pakistan and severely restricted in Bangladesh. For our part, last October, we removed Bangladesh from the list of countries from which foreign direct investment has been banned for security reasons. I am confident that we will be able to do the same for Pakistan in the coming months. The investment opportunities for Indian companies in these two countries are considerable. But in South Asia, politics has never been very advanced and economic justification alone has not been enough.

These countries will also have to overcome their reluctance to deal with India at the political level before we can make that wish a reality. Investments will not only be a one-sided flow. Sri Lankan companies are investing in India in sectors such as textiles, biscuits and furniture. Bangladeshi companies are interested in investing in India in sectors such as food processing, pharmaceuticals and paper. I am convinced that faster liberalisation of investment will bring an advantage to all and strengthen the SAFTA regime itself. I am pleased to say that SAFTA is on the right track and that it has already been decided to extend it to services as soon as possible. Apart from Bhutan, India has a large (and equally growing) trade surplus with all of its SAFTA partners, as shown in the table below. Regional integration has been defined as the process by which independent nation-states « voluntarily mix, merge and mix to lose the de facto attributes of sovereignty while acquiring new techniques to resolve conflicts between themselves. » [1] De Lombaerde and Van Langenhove describe it as a global phenomenon of territorial systems that strengthens interactions between their components and creates new forms of organization that coexist with traditional forms of state-run organization at the national level.

[2] Some scientists simply view regional integration as the process by which states in a given region strengthen their interaction on economic, security, or social and cultural issues. [3] A JSG was established in November 2003, the report of which was presented in November 2004. . . .