Comprehensive Economic Cooperation Agreement (CECA) Commemoration Gala Dinner
Ladies & Gentlemen,
1. Firstly, I would like to thank both MIBC and CIIM for inviting me to join you at this gala dinner commemorating the launch of the Malaysia-India Comprehensive Economic Cooperation Agreement or CECA, as we have all come to know it. I am indeed glad that MIBC and CIIM have taken the initiative to highlight this landmark agreement that will undoubtedly boost bilateral trade and lift Malaysia-India relations to new highs.
2. This gathering itself of eminent Malaysian and Indian business leaders, including the CEO Forum members I have just met, who have taken the time to discuss, dissect and explore the economic ramifications of CECA is indeed significant. It is precisely this shared approach of dialogue, involving both the public and private sectors taking place over the last few days, that will build momentum towards achieving historic volumes of trade between Malaysia and India.
3. I would not be able to talk about CECA and not highlight the dedication and commitment of officials and diplomats from both countries who persevered over two years to successfully complete negotiations. This process did face seemingly difficult issues but we remained steadfast, adopting a pragmatic approach, focusing on what is doable and prioritising a win-win outcome for both sides. While my counterpart, Dr. Manmohan Singh, and I often emphasised the importance of getting CECA off the ground, our respective trade ministers also played a crucial role in ensuring that all involved kept a view of the bigger picture at stake. I now take this opportunity to congratulate all of you, from Government and the private sector, from Malaysia and from India, who have worked so hard to make CECA a reality this year.
Ladies and Gentlemen,
4. As most of you here know, this bilateral agreement is indeed comprehensive, covering trade in goods and services as well as investment and economic cooperation. More specifically, one of the key achievements of CECA are the allowances for increased cross-flows in the services sector through liberalisation of foreign equity limitations. Furthermore, in terms of investments, the agreement covers the four main elements namely; liberalisation, protection, facilitation and promotion. These and other key aspects of CECA will play crucial roles in facilitating greater economic and commercial exchange across a broad swathe of sectors fundamental to both countries. The needs of the private sector have also been strongly addressed given that both Governments recognised the central role that the private sector has to play in driving bilateral trade growth.
5. Above and beyond trade and economic ties, we are confident that the country-to-country relationship will manifest itself more intensely and meaningfully as the many initiatives agreed to, take form and generate results. CECA is a fundamental pillar of Malaysia’s Strategic Partnership with India, a long-term and binding partnership that is altogether important going forward. This is particularly so given the fundamental shifts in the global economy and the other key transitions from the status quo happening all around us. In this rapidly evolving environment, a strong and robust partnership between both our countries and CECA’s role therein, is indeed significant.
Ladies and Gentlemen,
6. If we take stock at this point in time and analyse the Malaysia-India economic relationship, we will be able to take heart from the improvements achieved. What will also be equally clear is that we have much room for further expansion in the quantity and quality of our economic ties. A glance at our bilateral relations in numbers will show that India is Malaysia’s 12th largest trading partner and 9th largest export destination while Malaysia is among India’s top twenty trade partners, export destinations and source of imports. In 2010, total trade amounted to USD7.1 billion. What is heartening is that for the first 9 months of 2011, trade has already hit USD9.4 billion, representing an increase of 34.8% over the same period in 2010. Therefore, we are confident that with the rollout of CECA and continued Government focus, the targeted USD15 billion trade target will be met by 2015, and even quite possibly before.
7. Despite the active presence Malaysian and Indian companies in each other’s countries and the many fields that they are involved in, what is evident is that there is much room for further expansion in trade as there are vis-à-vis investment flows between Malaysia and India. As with the overall bilateral trade volume set by both Governments, the key stakeholders in specific sectors should also collectively set ambitious targets. This approach is especially relevant within the many areas in which the introduction of the CECA has delivered new incentives and removed historic limitations and barriers.
Ladies and Gentlemen,
8. From my numerous interactions with business leaders throughout the year, it is without doubt that both Malaysian and Indian private sectors are equally bullish on the potential to do much more together. While in and of itself, we can all be proud of the launching of CECA, we must be mindful that CECA’s more important role is as a means to an end and not an end in itself. We must work together to ensure that businesses and corporations make full use of the many incentives and liberalisation initiatives coming online this year.
9. It is therefore crucial that the benefits and liberalisation brought about by CECA are widely and effectively disseminated, particularly to the various trade, commerce, manufacturing and industry associations as well as to professional bodies. Another avenue we can use to ensure the relevance and application of the CECA is the Malaysia-India CEO Forum, established by our two Governments, and comprising top corporate leaders and business executives from each country. Furthermore, workshops, seminars and road shows have to be conducted and the media effectively engaged to reach as wide an audience as possible. I am happy to note that the Malaysian Ministry of International Trade and Industry, MIBC and CIIM have already begun work on this by hosting a series of workshops along sectoral lines. The fact that private business and individual entrepreneurs actively participated in these workshops is proof of the potential of CECA to capture and drive the commercial imagination.
10. Above discussion and dissemination of CECA’s thrusts and benefits, trade and industry associations, such as those organising tonight’s event, must collaborate more broadly to bring Malaysia and India closer together. I also encourage individual companies to tap on these associations, engage them, and get their views as you seek to understand both respective markets better. India-based and India-focused chambers and organisations will be able to provide insights and connections that might be useful as you enter the India market, whilst the various Malaysian counterparts can play a similar role in the Malaysian market.
11. From the Malaysian point of view, the chambers in India can play a key role in sharing the views of their member entrepreneurs and captains of industry on what needs to be done by the Government of Malaysia in order to attract investments from India. I would reiterate that Malaysia will do what is necessary for Indian business to increasingly view Malaysia as a strategic commercial destination that can play a key role in their business’ future growth and expansion. Looking beyond Malaysia-India, and considering that CECA complements the ASEAN-India Free Trade Agreement (AIFTA), our trade and industry associations can also play a role to bring India and ASEAN closer together. In this regard, Malaysia is ready to continue to facilitate the entry of Indian entrepreneurs into South East Asia.
Ladies and Gentlemen,
12. I want to take this opportunity to also speak directly to the many guests from India here today and provide an overview of the Malaysian economy. In our national objective to make Malaysia a high-income economy, the Government is focused on initiatives that will clearly communicate to the world that Malaysia is transforming. Malaysia’s Economic Transformation Program, or ETP, will ensure that we are near the forefront, competing with the top economies of the world. The numerous and significant programs and projects identified under the ETP will provide many opportunities for private business. Entrepreneurs from India through chambers of commerce and other business organisations, should pay close heed to Malaysia’s transformation and the opportunities that abound. This is as there are indeed many areas in which Indian companies can play a focused, constructive and indeed lucrative role in Malaysia’s onward development.
13. Malaysia will also continue to strive to simplify as well as reduce the cost of doing business. In terms of human capital, the Malaysian Government will continue to put the right measures in place to ensure that industry has ready access to a large pool of qualified and skilled Malaysians. Where financing is concerned, the Government is working to encourage businesses to take advantage of the opportunities Malaysian capital markets have to offer while also highlighting the services of Malaysia’s highly developed Islamic Banking and Financial Services industry.
14. Furthermore, we will continue to support enterprise through the many dedicated public sector agencies and also via consistent engagement with the private sector. We will also pursue policies that create an environment where entrepreneurs not just survive, but thrive. This is as Malaysia, much like India, recognises the critical function of entrepreneurs in developing and sustaining economic growth and wealth creation.
15. These initiatives and direction set by the Malaysian Government towards building a robust environment for business and commerce to thrive have received international recognition. In 2011 alone, the Institute for Management Development, or IMD, placed Malaysia 7th in the World Competitive Yearbook up from 10th place in 2010. The World Economic Forum ranked Malaysia 21st most competitive country in 2011 compared to 26th in 2010. The World Bank moved Malaysia up five notches to 18th position in terms of the ease of doing business between 2010 and 2011.
Ladies and Gentlemen,
16. In conclusion, let me say that both Malaysia and India are deeply committed and serious about providing the business community on both sides with conditions that are as conducive and comfortable as possible. Our main role is to provide the necessary legal and trade frameworks under which you will be fairly treated, your investments will be secure, your profits freely remitted and where you can move about freely. The potential for investments and conducting businesses in both countries are huge and the opportunities vast. If problems do arise, then you know that you have a ready hand to help you. It is my sincere wish that full advantage be taken of CECA so that we can progress to a more tangible, strategic and long-term relationship that will positively impact the people of both countries.
17. The Government naturally welcomes feedback from the deliberations of this conference and wishes all of you every success in your future ventures, in which I hope Malaysia will figure prominently. For those of you from abroad, I hope you manage to find the time to enjoy the many charms that Malaysia has to offer. In ending, I thank you for inviting me to share my thoughts with you and wish you all the very best.