Commerce and industry minister Suresh Prabhu (PTI file photo)

SINGAPORE: India and Singapore will initiate the next round of review of their existing free trade agreement tomorrow with a view to further promote commercial ties between the countries.

Commerce and industry minister Suresh Prabhu , who is here on an official visit, held discussions with Singaporean counterpart Chan Chun Sing on the issue.

"Both India and Singapore are looking forward to launch the third review of India-Singapore CECA on September 1. This will provide further momentum to the growing collaboration between our two countries," Prabhu said in a series of tweets.

Both the countries have recently signed the second protocol to amend the pact, officially dubbed as Comprehensive Economic Cooperation Agreement (CECA).

This agreement, which has liberalised rules for trade in goods and services, came into force on August 1, 2005 and the first review was concluded in October 2007 and the second one in June this year. In an FTA review, two trading partners look to further relax rules to increase trade.

Prabhu said he also discussed about the issues of the proposed mega trade deal RCEP (Regional Comprehensive Economic Partnership).

Both India and Singapore are part of this 16-nation grouping. The group is negotiating a comprehensive free trade agreement since November 2012.

RCEP comprises 10 Asean members as well as Japan, Korea, China, India, Australia and New Zealand.

"We also discussed on working closely to further engage bilaterally and in the RCEP," the Indian minister said.

Prabhu is here for the ministerial meeting of RCEP members. Besides, he would participate in the 6th East-Asia Economic Ministers and India-Asean Economic Ministers meetings.

Meanwhile, a diplomatic source here said Singapore and India can do a lot together and take a strategic long-term economic and geopolitical view for engaging in Asia Pacific, which is being rated as the most dynamic growth region of the world.

Though India is reportedly taking a cautious approach to RCEP formation, New Delhi must think of being a part of the "dynamic Asia Pacific region", the source said on condition of anonymity.

India is cautious as it believes that lower tariffs arising from the pact may further exacerbate its trade deficit with China.

New Delhi is trying to increase sharing of its resources and skilled manpower in the region. Singapore has emerged as Research & Development hub at its universities.

Over 8,000 Indian companies are based in Singapore with many having set up regional headquarters with operations across the region, the source said.

Singapore is a natural springboard for Indian businesses to leap into the Asean and the broader East Asian regions, the source said, underlining the importance of the Asia Pacific markets of nearly two billion people.

These professionals are deeply familiar and connected with India. They can act as a great bridge between the two countries in informal and formal capacities, said the source.

