ASEAN and India finally concluded a deal for free trade in goods here on Thursday morning after six years of talks, with the agreement set to be inked at a summit in Bangkok in December.

The two sides also agreed to begin negotiations to extend the trade pact to services and investments, with both sides targeting to complete this by end 2009.

India-Asean trade reached US$38 billion (S$53.8 billion) and grew 25 per cent last year.

Indian Commerce and Industry Minister Kamal Nath said the target is to achieve US$50 billion of trade with Asean by 2010.

The Asean-India FTA has suffered several delays because of India's sensitivities on various commodities, including palm oil. But Indonesia and Malaysia have taken steps to remove these obstacles.

'This will add to the bargaining power of Asean and India in the international arena,' said Asean secretary-general Surin Pitsuwan at a news conference on Thursday.

He added that an FTA with Australia and New Zealand was 'within striking distance'.

This agreement will complement the existing Singapore-India Comprehensive Economic Cooperation Agreement signed in June 2005, as it offers local exporters a choice of which preferential avenue to use to maximise returns.

Companies will stand to benefit from enhanced market access in India from tariff reductions and lowered barriers of trade.

Asean-China investment pact by year end
The 10-member regional grouping is also aiming to finalise an investment agreement with China by December, completing a free trade deal that already covers goods and services, the two sides said on Thursday.

In a statement issued after meetings between economic ministers from Asean and China, they said 'substantive progress' has been made on the Asean-China Investment Agreement.

Ministers 'underscored the importance of concluding the Agreement' by December when Asean holds its annual summit in Bangkok.

The investment pact is one of three components of a free trade deal between Asean and China. Agreements covering trade in goods and trade in services were reached in 2004 and 2006.

'The ministers were confident that the Asean China FTA (Free Trade Area) remains a regional trading arrangement of some global significance given the magnitude of trade between the parties, which accounted for 13.7 per cent of global trade or almost half of Asia's total trade in 2007,' the statement said.

T'he review reaffirmed the strong trade ties between the parties and the prospects for enhanced trade flows in the coming years as more tranches of tariff reductions come on stream.'