The most astounding aspect of the current global economic environment has been the
process of intense integration of economies precipitated through gradual acceleration of
multilateralism and emergence of regionalism, primarily facilitated by the growth of Regional Trading
Arrangements (RTAs) and bilateral Free Trade Agreements (FTAs). The studies show that FTA framework
injects a new dynamism into consideration of the liberalization of trade in goods. In committing to
this agreement, countries recognize that multilateral trade negotiations are the most
effective mechanism to achieve trade liberalization and thereby promote national and regional
economic development. Each country does, however, recognize through their existing bilateral free
trade agreements with the other selected trading partners, the potential for World Trade
Organization (WTO)-consistent free trade environment to deliver welfare at a more rapid pace. To a
great extent, such agreements can, in turn, support and reinforce multilateral liberalization in
the WTO. This is clearly evident in the Asian region, the current epicenter of the global
economy, though regionalism is a belated development in comparison to other regions. Like other parts
of the world, all the vibrant economies in Asia are currently negotiating and/or finalizing
various RTAs and bilateral FTAs, with the sole aim of expanding the horizon of their national
economies through synergizing complementarities in a win-win proposition. India is no exception.
Since the opening up of its economy in the beginning of the 1990s, India has marched
great strides to be one of the fastest growing economies of the world owing to the
substantial structural economic reforms, especially visible in its trade policy regimes. The forward
growth momentum and its structural components have induced India to be aligned with other
liberalized countries in order to be fully integrated with the global economy. As a result, in recent
years, India has signed a number of bilateral PTAs/FTAs. Towards this aim, there are intentions
of accelerating the process forward by entering into similar agreements with the Gulf
Cooperation Council (GCC), comprising six countries, namely, Bahrain, Kuwait, Oman, Qatar, Saudi
Arabia and the United Arab Emirates (UAE). |