After signing India-ASEAN Free Trade Agreement as one of the 10 members of the bloc, Jakarta and New Delhi are set to launch negotiations for a similar bilateral deal to open trade in goods and services.
The Joint Study Group (JSG), which was set to explore the feasibility of a Comprehensive Economic Cooperation Agreement (CECA), has recommended launching of full fledged talks to negotiate a pact that can take the two-way trade merchandise trade to $20 billion by 2020.
"The JSG finding suggest that there is a strong case for concluding a CECA between India and Indonesia as a first step towards an FTA in trade in goods, services, investments and other areas of economic cooperation," the report on the feasibility of the agreement stated.
The 2008 bilateral trade of about 7 billion is highly favourable to Indonesia with India running a gap of $3.22 billion.
The pact would be on similar lines that India signed with Singapore which covers the entire gamut of economic ties and is in sync with the New Delhi's 'Look East Policy' that aims at promoting engagement with the countries in South East Asia.
The agreement with Association of South East Asian Nations (ASEAN) signed on August 13 would remove or reduce duty barriers on about 4,000 products of trade from January next year.