Malaysia is likely to allow equity holdings from India, ranging from 49 to 100 per cent, in 91 sub-sectors of the services domain.
Under the India-Malaysia Comprehensive Economic Cooperation Agreement (CECA), ready for signature on Friday (February 18), New Delhi has agreed to make a reciprocal gesture to Malaysia in 84 sub-sectors under the rubric of services. The CECA, which took just about a year to finalise, will be signed by Commerce and Industry Minister Anand Sharma and his Malaysian counterpart in Putrajaya, administrative capital outside Kuala Lumpur.
Malaysia's Secretary General for International Trade and Industry Rebecca Fatima Sta Maria told The Hindu from Kuala Lumpur that both countries adopted ‘a WTO-Plus' approach towards resolving issues in the services domain. These included ‘a freer movement of natural persons' and robust e-commerce norms. India, she said, ‘is very, very open in the services sector,' and it was, therefore, possible for both sides to opt for an approach that went beyond the multilateral offers now on the table at the World Trade Organization.
The CECA, which would come into effect on July 1 upon being signed on Friday, would cover a wide spectrum of services, including those of a highly technical nature. “It is still early days for Malaysia” in the services domain, compared to India, but ‘an opportunity' was being provided ‘to review and make the deal better' for both sides.
On investments, Dr. Rebecca said India had agreed to Malaysia's proposal of ‘a negative list approach' and this did help clinch the overall economic pact. India would indicate just the no-go areas for investments from Malaysia instead of insisting on specifying where foreign capital might be welcome.
Describing the CECA in its totality as an ‘ASEAN-Plus' document, she said trade-offs were in the goods sector, with both sides looking at the ‘positives' and making ‘compromises.' Malaysia and India sought and achieved preferential tariffs beyond those in India's now-operational accord on trade in goods with the Association of Southeast Asian Nations. Malaysia would receive preferential tariffs for its palm oil, palm oil products, cocoa, and textiles (synthetics). India, she said, was being given a similar market access for basmati rice, mangoes, and cotton.