Almost one-third of the world's population signs free trade agreement

The republic signed the world's largest free trade agreement in the form of the Regional Comprehensive Economic Partnership (RCEP) on Sunday (Nov 15).

The deal, which was first proposed in 2012, will lower tariffs on trade among the signatories and opens services trade.

The ten members of the Association of Southeast Asian Nations along with Japan, China, South Korea, Australia and New Zealand approved the deal at an online summit on Sunday.

India was involved in early discussions but opted out previous year over concerns related to cheap Chinese imports. However if India wants it can join the group any time.

India has missed out on the opportunity to a new round of regional industrial reconstruction and fast lane of economic recovery by opting out of the Regional Comprehensive Economic Partnership (RCEP), the Global Times said on Monday.

Another major lookout for India is how it will tackle with the ASEAN countries in trade, after backing out from the RCEP.

After seven years of negotiations, the Narendra Modi-led government dropped out of the RCEP-related talks at the end of 2019.

In May, The Hindu had reported that according to senior official sources, concerns regarding China in the post-coronavirus world scenario had prevented Delhi from restarting negotiation for membership of RCEP.

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RCEP provides some flexibility for less-developed members to implement the practical and legislative changes it requires.

Specifically which areas are open to tariff reductions under RCEP is complex and changes from country to country. Some states have listed what RCEP includes, others have listed what it does not.

For countries which already have free trade agreements with each other, an added benefit of RCEP is that it creates a common set of rules of origin, which will facilitate easier movement of goods between the 15 members.

How does RCEP compare with CPTPP?

With the United States, under President Donald Trump, having left the Barack Obama-led Trans-Pacific Partnership - the world's biggest economy is now on the outside of two trade groups spanning the world's fastest-growing region. It gained momentum when Trump withdrew the United States from the Trans-Pacific Partnership (TPP) in 2017.

Earlier this week, when asked if India will join RECP, Secretary East in Ministry of External Affairs Riva Ganguly Das said, "Our position is well known, as far as India is concerned we did not join RCEP as it does not address the outstanding issues and concerns of India, however, we remain committed to deepening our trade relations with ASEAN".

Dispute settlement mechanisms ultimately did little to resolve political differences, with the political willingness of the nations concerned counting most, both Wang and his CIBEL Centre colleague global economic law specialist Weihuan Zhou said.