Indonesia keen to strengthen trade ties with India

The government of Indonesia is keen to strengthen bilateral trade relations with India in an effort to give impetus to bilateral trade, a top government official said.

The Indonesian government has commenced talks with the government of India in this regard and the issue is likely to come up for discussion during the visit of Prime Minister Narendra Modi to Indonesia later next month, Ade Sukendar, Consul General of the Republic of Indonesia in Mumbai said.

India already has a Free Trade Agreement with ASEAN, in which Indonesia is a member country. However, Indonesia wants to further strengthen bilateral trade agreements with India, he said.

“At present, we don’t have a free trade agreement with India and we want to explore it with India as we are looking forward to increase the bilateral trade,” Sukendar told DH.

Indonesia has emerged as the largest trading partner of India in the ASEAN region in the recent years. The bilateral trade has increased from $4.3 billion in 2005-06 to $18.13 billion in 2016-17. India is the second largest buyer of coal and crude palm oil from Indonesia and imports minerals, rubber, pulp and paper and hydrocarbons reserves. In return, India exports refined petroleum products, commercial vehicles, telecommunication equipment, agriculture commodities, bovine meat, steel products and plastics to Indonesia.

A free trade area is the region encompassing a trade block whose member countries have signed a FTA. The ASEAN–India Free Trade Area (AIFTA) is a free trade area among the 10 member states of the Association of Southeast Asian Nations (ASEAN) and India. The free trade area came into effect on January 1, 2010. India hosted the latest ASEAN-India Commemorative Summit in New Delhi on December 20–21, 2012.

Meanwhile, the Indonesian national carrier Garuda Indonesia has restarted direct flights between Mumbai and Bali. “We are looking at attracting 7 lakh tourists from India and a direct flight will help in achieving the target. The Garuda Indonesia is currently flying twice a week and will operate the third flight from June,” Sukendar said.

The airline is also exploring the possibility of starting direct flights with other Indian cities such as Bengaluru, Chennai and New Delhi at a later date, he added.

About 4,85,314 Indians visited Indonesia in 2017, a growth of 30% over the previous year. In order to attract more foreign visitors, the government of Indonesia is providing free visa on arrival for upto one month, he said.