Movement of natural persons and free trade agreements: India's prospects

Abstract

India is one of the leading nations that export labour sen/ices. India also receives the highest amount as remittances from abroad. India's remittances also have increased steadily over the years. Trade in services has got a lot of attention from economists since the introduction of GATS under WTO. Movement of natural persons under Mode 4 of GATS assumes lot of significance for many countries including India. Multilateral trade negotiations under WTO has proved to be time consuming and less successful. Negotiations under Mode 4 of GATS are the least successful ones and the number of commitments under Mode 4 are very few. Many countries are turning their attention to Regional Free Trade Agreements (FTAs) as a means to liberalize trade in goods and services. India is not an exception to this. India too negotiated many RTAs and are at various stages of its implementation. In recent years India is paying special attention to movement of natural persons in all FTA negotiations. India-Singapore CECA and India-ASEAN FTA on services are examples for this. The study reveals that India has great prospects in promoting the movement of natural persons through FTAs. Major implication of the study, results in the findings that India should pay more attention to FTAs in getting maximum benefit from movement of natural persons rather than waiting for outcomes of multilateral negotiations.