The government on Tuesday approved the draft of India's free trade agreement with Japan, which is likely to be signed during Prime Minister Manmohan Singh's visit to Tokyo later this month.
The Economic Partnership Agreement (EPA), which will be comprehensive in nature covering about 90 per cent of the bilateral trade, will pave way for the Indian pharmaceuticals to get access to the highly regulated Japanese market, sources said.
Besides, thousands of other products ranging from steel and apparel to machinery will be traded between the countries, either without duty or at substantially reduced tariffs.
The Cabinet today approved the draft pact, sources said. The Prime Minister is scheduled to visit Tokyo on October 24 for the India-Japan Summit.
The EPA will cover both, trade in goods as well as investments, and help boost the $11-billion bilateral commerce.
However, some items in agriculture and employment- oriented sectors have been kept out of the purview of the pact to protect the sensitive areas, they said.
The negotiations for the EPA have been going on for the last three years but efforts to conclude it had intensified since beginning of this year. India has already operationalised market opening trade pacts with the ASEAN and South Korea. These trade opening pacts are part of the country's 'Look East' policy.
