Regional Comprehensive Economic Partnership – Unresolved Issues with India 25/06/2019 – Posted in: Daily News – Tags:

REGIONAL COMPREHENSIVE ECONOMIC PARTNERSHIP

 

For: Preliminary & Mains

Topics covered: RCEP, Trade pact, Unresolved issued with India, Impact on India

 

News Flash

Thailand, the current chair of ASEAN, has urged participating countries to rapidly conclude negotiations on an agreement to the Regional Economic Comprehensive Partnership (RCEP).

RCEP is a trade pact between the 10-member ASEAN bloc, along with China, Japan, South Korea, Australia, New Zealand, and India.

 

What

  • India could be cut out of the Regional Comprehensive Economic Partnership (RCEP) being negotiated by 16 countries led by the ASEAN bloc if it doesn’t agree to join RCEP by the year-end.
  • Malaysian Prime Minister said he would prefer to go ahead with a formulation of 13 countries that are willing to go ahead immediately, and allow outliers India, Australia, and New Zealand to join the pact at a future date.
  • India has unresolved issues and is constantly engaged with RCEP negotiations.
  • The pact will cement China’s domination over others, as America pulled out of a trade pact of its own.
  • The US withdrawal opened the door to the China-led RCEP.
  • The US now focusing on bilateral agreements with Asian nations and insists it is not retreating from the region.

 

Impact on India

India fears the deal means its market will be flooded with Made-in-China goods that will hurt domestic manufacturers.

The country is concerned that with RCEP in place, imports from RCEP countries may grow even faster than its exports to the bloc.

India is reluctant to cut tariffs and open its markets in the face of strong opposition from it’s farming as well as steel and textiles industries.

 

Unresolved Issues

  1. Free Trade Agreements.
  2. Rules around labour and environmental protections.
  3. Strengthening intellectual property terms.
  4. India would like to see better access for its professionals to the services sector in RCEP countries included in the agreement.

 

Regional Comprehensive Economic Partnership

  • Launched in 2012, RCEP is a trade pact between the 10-member ASEAN bloc, along with China, Japan, South Korea, Australia, New Zealand, and India.
  • It links around 3.4 billion people and when signed will be the world’s biggest free trade pact.
  • It is also expected to cover about a quarter of the world’s exports.
  • Its aim is to break down trade barriers and promote investment to help emerging economies catch up with the rest of the world.

 

Source: Economic Times

 

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