CECA and CEPA are pacts between two countries for economic cooperation. While CEPA stands for Comprehensive Economic partnership Agreement, CECA is the short form of Comprehensive Economic Cooperation Agreement. The two terms came in light recently as India signed a CEPA with Japan and CECA with Malaysia. India also has a CEPA with South Korea. Another country with which India has recently entered into an economic pact is Singapore with CECA.
The terms are important for bilateral economic cooperation. The two types of agreements are almost similar in nature. However, the major difference lies in the use of words Cooperation and partnership in the two types of economic pacts. While in the case of CECA, the emphasis is on reduction of tariffs or elimination of tariffs in a gradual manner of all items listed as tariff rate quota items, in the case of CEPA, it is also about trade in the fields of services and investments. Thus it is clear that CEPA has a wider scope than CECA.
Another difference between CEPA and CECA is that it is CECA that get signed between two countries first, and then the two countries move ahead in the direction of CEPA. To take an example, India and Sri Lanka signed off a treaty of economic cooperation called as Free Trade Agreement in 1998, which was in essence CECA. India embarked on gradual removal of tariffs which was finally achieved in 2003. Sri Lanka on its part started removing tariffs and achieved it in 2008. The two countries then started talks on CEPA which also covers trade in services and investments.
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Summary • CECA and CEPA are economic agreements between two countries • While CECA comes first with elimination of tariffs, CEPA comes later including trade in services and investments • CEPA is wider in scope than CECA |