BANGKOK(Commodity Online) : India and China, two of the world’s fastest growing economies along with Asean is all set to become world's largest economic bloc in the not-too-distant future.

According to analysts, Asean’s policies are likely to be dictated by its two neighboring economic powerhouses.

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Asean, despite its size has a population of 580 million - the association's policies are likely to be dictated by its two neighboring economic powerhouses.

The Asean+6 grouping is expected to account for about 27% of global gross domestic product and this will overtake the EU and the United States economies analysts said.

The size of the Asean+6 economy would be about $20 trillion by 2014.

According to former Asean deputy secretary general Suthad Setboonsarng, Asean+six economies will be larger than 27 combined economies of the EU BY 2011.

"If you look at our economies we can safely say that by 2011 our economies will be larger than the combined 27 economies of the EU," he said.

"Once again this tremendous growth is on the back of the two countries - China and India." He said.

In his view, China and India have also implemented measures that will ensure they maintain their growth, despite fears the momentum might slow.

Food production is an area that Suthad sees as holding special interest, because the Asean region has fertile land whereas both China and India lack enough agricultural land to feed their populations.

"There are areas where Thai companies have expertise and can tap the Chinese and Indian markets," he said.

But the development of India and China could also result in Asean falling behind as its two neighbours make giant strides forward.

"We are the meat in the sandwich between China and India and as the growth of both these countries accelerates in the years to come, the disparity between Asean and the two neighbours will likely become even greater” he added.

"We foresee that the Asean economies will grow by 6% to 7% annually over the next few years and by 2014 it will be a $2-trillion economy," he said.

Governments in the region are all trying up link up with China and India to ride on their bandwagon of growth, said Suthad.

"This is the reason why we have undertaken a host of FTAs (free trade agreements)," he said, adding that China had initiated FTAs as it wanted a good base for sourcing raw materials.

The China-Asean FTA (Cafta) implemented on Jan 1, 2010 is aimed at expanding trade co-operation and bilateral investments over a grouping with a population of 1.9 billion, a regional GDP of more than $6 trillion and a trade value of more than $4.5 trillion, he said.

The Cafta cut tariffs to zero on 90% of goods in 7,000 product categories for six Asean members: Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. The other four members - Cambodia, Laos, Burma and Vietnam - will see their tariffs reduced to zero by 2015.

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