The Regional Comprehensive Economic Partnership (RCEP) is a proposed free trade agreement being negotiated by 16 countries, including 10 Asean members (Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam) and their six free trade agreement partners – India, China, Japan, South Korea, Australia and New Zealand, since November 2012.
The meeting assumes significance as there is a tremendous pressure on India to conclude the negotiations as early as possible despite the fact that several issues pertaining to goods and services have yet to be agreed upon by the member countries.
The mega pact aims to relax norms and significantly cut import duties to boost trade in goods, services, promote investments, technical cooperation, and intellectual property rights.
The trade ministers will again meet in November to push the talks.
Domestic industry sectors, including steel, engineering, and metals are raising concerns over the presence of China in the group. They have stated that lowering or eliminating duties for China will flood Indian markets with Chinese goods.
India already has a free trade agreement with Asean (Association of South East Asian Nations), Japan, and South Korea. And it is negotiating similar pacts with Australia and New Zealand. Besides, India has a trade deficit with 10 countries in this grouping.
Trade experts too have expressed apprehensions that eliminating duties for Chinese goods may further impact domestic industries.
The trade gap with China, Korea, Indonesia and Australia has increased to USD 63.12 billion; USD 11.96 billion; USD 12.47 billion and USD 10.16 billion in 2017-18. It was USD 51.11 billion, USD 8.34 billion, USD 9.94 billion and USD 8.19 billion, respectively, in the previous financial year 2016-17.
India is pushing for liberalising norms to promote services trade as the sector accounts for about 55 per cent of the country’s GDP.
Commerce and Industry Minister Suresh Prabhu had earlier stated that negotiations for the mega-trade deal will continue in 2019 as more rounds of talks are required to sort out issues pertaining to goods and services.
The negotiations have dragged on as the member countries wants India remove customs duties on maximum number of products traded between them. However India have reservations on this as the grouping includes China, with which New Delhi has a huge trade deficit.
India is looking for a balanced trade agreement as it would cover 40 per cent of the global GDP and over 42 per cent of the world’s population.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)