Singapore, India signed CECA: A More Liberal Agreement Than Chinese CSFTA

India and Singapore signed CECA – India-Singapore Comprehensive Economic Cooperation Agreement in 2005. This free trade agreement (CECA) not only enables Singapore and India to trade goods freely, it also allows professionals to work in each other country more easily.

The CECA was concluded after 13 rounds of negotiation and the Singapore’s side was led by none other than Heng Swee Keat, the current PM-in-waiting, who was then Permanent Secretary for Trade and Industry. Heng and his team essentially did the ground work together with their Indian counterparts. They then presented their proposals to the politicians for approval.

China signed CSFTA with Singapore, however CECA seems to be a more liberal and open-handed agreement according to experts. In 2009, the China-Singapore Free Trade Agreement (CSFTA) came into force. This is China’s first comprehensive bilateral FTA with an Asian country.

China is Singapore’s largest trading partner while Singapore is China’s largest foreign investor since 2013. In 2017, Singapore’s cumulative investment in China amounted to S$140 billion while China’s cumulative investment in Singapore amounted to S$36.3 billion.

Under the agreement, both countries are allowed to facilitate the free “movement of natural persons” to each other country. It facilitates temporary entry of natural persons for the purpose of trade while recognising the need to ensure border security and to protect the domestic labour force in the territories of both parties.

In essence, the agreement facilitates the movement of the following people like business visitors; Contractual services suppliers and Intra-corporate transferees.

Under the agreement, Singapore will allow a Chinese business visitor to stay for a period of up to 60 days with extension for further 30 days. This is for Chinese holders of 5-year multiple journey visa. For holders of all other visas, Singapore will grant the right to temporary entry for a period of up to 30 days, which may be extended for a further 30 days.

In contrast, Singapore is more generous to India when comes to CECA. Under CECA, Indian business visitors with a 5-year multiple journey visa are granted temporary entry for a period of up to two months with further extension for another. Those with less than 5-year multiple journey visa are granted temporary entry for a period of up to one month.

For contractual services suppliers and intra-corporate transferees, the terms are similar to that of CSFTA. The only difference is that for CECA’s intra-corporate transferees, they must have been employed by the company for not less than 6 months before he or she can be qualified for the transfer to the host country.

In the CSFTA agreement, In the case of contractual services suppliers, the person must have been a PMET(Professionals, Managers, Executives and Technicians)  employee of the service supplier for at least 1 year preceding the date of their application for admission. Entry is limited to 90 days with possibility for a further extension of up to 90 days, provided the total does not exceed 180 days or the length of the service contract, whichever is shorter.

That is, the maximum stay allowed in Singapore is 6 months for Chinese PMET on contract to provide a service in Singapore by his or her service supplier in China.

For intra-corporate transferees, the person must have been in the prior employ of their firms outside Singapore for a minimum of 1 year preceding the date of their application for admission. Their stay is limited to 2 years but can be extended for periods of up to 3 additional years each time, for a total term of not more than 8 years.

The professional is essentially contracted to work in the host country for up to 1 year. Since nothing is said in the agreement denying the professional’s renewal of his or her contract, it is presumed that he or she can continue to work in the host country to “finish up” the contracted work as long as the contract is continually renewed by the the business party who is actively engaging the professional in the host country.

CECA also specified 127 different occupations that the professional can engage in the host country as long as they have equivalent degrees conferred by institutions in India and Singapore. And under CECA, intra-corporate transferees as well as “long-term temporary entry” professionals are allowed to bring in their spouses or dependants into the host country. They are allowed to “work as managers, executives or specialists, subject to the relevant licensing, administrative and registration requirements”.

“Such spouses or dependents can apply independently in their own capacity (and not necessarily as accompanying spouses or dependents) and shall not be barred by the Party granting them the right to work from taking up employment in a category other than that of managers, executives, or specialists solely on the ground that they as the accompanying spouses or dependents are already employed in its territory as managers, executives or specialists,” CECA stated. In other words, the spouses or dependents can work in non-PMET jobs in the host country.

Clauses relating to the employment of “long-term temporary entry” professionals as well as employment of spouses or dependents are not found in the same chapter (“movement of natural persons”) in CSFTA. Only CECA has them.

We can owe the generosity to the strong and friendly bilateral relations with both the countries enjoying extensive cultural and commercial. Singapore and India have a common goal that is  increase trade, investments and economic cooperation, and expanded bilateral cooperation on maritime security, training forces, joint naval exercises, developing military technology and fighting terrorism through CECA.

More than 300,000 people of Indian origin live in Singapore. Following its independence in 1965, Singapore was concerned with China-backed communist threats as well as domination from Malaysia and Indonesia and sought a close strategic relationship with India, which it saw as a counterbalance to Chinese influence and a partner in achieving regional security. Singapore had always been an important strategic trading post, giving India trade access to the Far East.