Could join RCEP if demands are met, says Piyush Goyal

Daniel Fowler
November 6, 2019

"In such a situation, it is not possible for India to join RCEP agreement", he asserted.

The RCEP originally would have included about 3.6 billion people and encompassed about a third of world trade and global GDP.

However, India has been repeatedly raising the issue of market access as well as protected lists of goods primarily to shield its domestic market with fears of cheap Chinese agricultural and industrial products flooding the country if India signed the deal.

Meanwhile, leaders of all the participating countries stated that they would "work together" to resolve India's concerns.

At the summit, Modi said his decision was guided by the impact the RCEP would have on the "lives and livelihood of all Indians, especially vulnerable sections of the society".

The 11th-hour pullout comes after days of late-running negotiations at the ASEAN Summit which closed Monday. That trend has accelerated amid feuding between the United States and China over trade and technology, which has ramped up uncertainty as the two largest economies imposed billions of dollars' worth of punitive tariffs on each other's exports.

For Modi, the current domestic situation could not have been less conducive to signing an global trade pact created to more closely integrate India's economy with the countries of RCEP, which include China, Japan, Australia, South Korea, New Zealand and the 10 members of the Association of Southeast Asian Nations.

The remaining members are aiming to sign it next year after reviewing an agreed draft text.

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The leaders of Japan, China and South Korea, as well as ASEAN member nations, meeting in Bangkok had been seeking to reach an agreement on RCEP before the end of the year. "It was a massive missed opportunity", said Deborah Elms of the Asian Trade Centre in Singapore.

This is the reason why the 15 countries did not sign the deal Monday and chose to wait until 2020, sources said.

There is another regional trade agreement that took effect in December: the 11-country Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the successor of the previous Trans-Pacific Partnership (TPP) that U.S. President Donald Trump pulled out of in 2017. "In the absence of a fair deal, Modi has wisely decided against joining RCEP - effectively a back-door FTA with China". India is opposed to the proposal that 2013 be treated as the base year for reducing tariffs, effectively implying that member countries should slash import duties on products to the level that existed in 2013.

"I was treated generously", he told reporters. In 1992, India had launched the Look East Policy as a means to focus on Southeast Asia.

A crucial breakthrough in negotiations on a mega regional trade agreement announced here on Monday has reaffirmed the Asia Pacific's strong support for free trade and multilateralism. She said the CPTPP won't "stand still", and it will provide the foundation for even greater free trade integration in the region.

"Against the backdrop of a fast-changing global environment, the completion of the RCEP negotiations will demonstrate our collective commitment to an open trade and investment environment across the region", they added. The Philippines said Saturday that negotiations wouldn't be completed until February.

"Only the 15 countries concluded for now since India has until next year to settle his remaining issues, and decide if he can still sign with the 15 countries next year".

China's deputy foreign minister Le Yucheng echoed the view.

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