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‘Key India-Malaysia pacts likely’
India and Malaysia plan to finalize agreements on payments, defence, and semiconductor cooperation during PM Modi's visit on February 7-8.
New Delhi: India and Malaysia are expected to finalise several agreements, including one between the National Payments Corporation of India (NPCI) and Malaysia’s PayNet, and explore ways to step up defence and security cooperation during Prime Minister Narendra Modi’s visit to the Southeast Asian country this weekend, senior officials said on Thursday.
The two sides are looking at the possibility of firming up memorandums of understanding (MoUs) for cooperation in the semiconductor industry, disaster management, training standards and certification for seafarers, anti-corruption, and healthcare, P Kumaran, secretary (East) in the external affairs ministry, told a news briefing.
“The NPCI is set to sign an agreement with PayNet during the course of the visit. That will be one of the expected outcomes,” he said.
Kumaran noted that Malaysia has a very strong semiconductor ecosystem, with almost 30% of the country’s exports comprising semiconductors and allied products. “We are in the process of establishing a multi-layered collaboration arrangement through a government-to-government MoU, including research and development and the setting up of fabrication centres and testing centres,” he said.
Defence and security have emerged as key areas for cooperation, and the Indian side is looking at the sale of Dornier aircraft to Malaysia and the potential for collaborating in the mid-life upgrades and retrofitting of Scorpene submarines, which are operated by both sides, Kumaran said.
With the air forces of both countries operating the Russian-origin Su-30 combat jet, India has offered proposals for modification, upgradation and mid-life maintenance of these aircraft. “We are also looking at the potential for supply of naval platforms by Indian shipyards,” he said. “Those are all areas that look promising, we hope to be able to get something going in these areas.”
Modi is set to visit Malaysia during February 7-8, when the two sides are expected to set an agenda for future engagements and advancing business ties. Modi will hold talks with his Malaysian counterpart Anwar Ibrahim and interact with industry and business representatives and the Indian community.
Malaysia is India’s third largest trading partner in the Asean region, with two-way trade worth around $20 billion. Trade has diversified beyond commodities such as palm oil and includes agricultural products, chemicals, minerals and machinery. Major Malaysian investors such as Petronas and UEM Group have a strong presence in India.
Malaysia also plays an important role in the ongoing review of the Asean-India Trade in Goods Agreement (AITIGA), Kumaran said. “We’ve agreed on the terms of reference, and…the commerce ministry has been engaged with Asean, exploring various options to try and create a better balance in trade between India and Asean,” he said.
“There are technical elements being discussed in terms of offering more lines under a liberalised regime between India and Asean. I think there is a broad sense that the overall average tariff in Asean has to improve compared to the existing level,” Kuamaran said, adding that the focus is on a minimum percentage of tariffs for each Asean member state to open up in order to achieve a better trade balance.
Kumaran responded to a question on India’s efforts to extradite controversial preacher Zakir Naik, who faces charges of money laundering and inciting terrorism, by saying that New Delhi has raised this matter during past visits and it is expected to figure during the upcoming visit. “We will continue to take up the issue until all technical procedures are completed. We hope to get the outcome that we desire,” he said.
