India signs FTA with ASEAN; Suu Kyi convicted and sentenced to 18 months of house arrest; Thai PM visits Philippines; ASEAN signs an investment agreement with China; Tensions rise in South China Sea region
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    • India has signed a free trade agreement (FTA) with ASEAN on August 13. The primary objective of the agreement is to reduce tariffs imposed on 80 percent of traded goods between the two regions. The FTA, to be effective from January 1, 2010, also aims to boost the annual bilateral trade, currently at $40 billion1.

    In Myanmar, pro-democracy leader Aung San Suu Kyi has been convicted and sentenced to 18 months of house arrest on charges of allowing an American tourist to visit her during confinement. The American himself was released after the visit of Democratic Senator Jim Webb2.

    Thai Prime Minister Abhisit Vejjajiva visited the Philippines on August 14. While the primary objective of the visit was to strengthen bilateral trade and investment ties, Abhisit also discussed issues like the developing situation in Myanmar as well as the continued detention of Aung San Suu Kyi with President Gloria Arroyo3.

    During the 41st ASEAN Economic Ministers’ (AEM) in Bangkok, ASEAN member states signed an investment agreement with China to boost bilateral economic ties. Indonesian Trade Minister Mari Elka Pangestu stated that the agreement provides “a clear platform to develop economic integration with one of the world’s key economic players” and added that the aim of the agreement was not “liberalization, but investment facilitation, promotion and the creation of legal certainty4.” China has also proposed the setting up of two ASEAN-China funds worth $10 billion and $15 billion respectively for the purpose of financing adequate infrastructure, logistic system and trade mechanisms5.

    China and Vietnam held talks in Hanoi with an aim to arrive at mutually acceptable solutions to their long-drawn bilateral dispute over the South China Sea. Emphasizing the need to have friendly relations, both sides agreed to find a lasting solution to the dispute without affecting their bilateral relationship adversely6.

    Tension in the South China Sea region however increased with China protesting against Philippines’ plans to extract oil from the Reed Bank, an area which both the states claim to be a part of their own territory7.

    Meanwhile, responding to the UN’s call to the states of the region to lodge their protests against territorial claims by other states, Philippines formally lodged a protest against Vietnam, Palau and Malaysia for their claims over the Spratly Islands8.

    In other developments, China released the Vietnamese fishing boat as well as its 13 crew members detained on August 1, 2009 near the controversial Paracel Islands in the South China Sea. However, no decision was taken on the release of twelve other Vietnamese fishermen who have been detained since mid-June. China and Vietnam have long been involved in a long-standing territorial dispute over the Paracel Islands9.

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