India weighs trade pact concerns ahead of key Bangkok meet
NEWDELHI: Prime Minister Narendra Modi on Monday chaired a meeting on RCEP, a proposed trade agreement between 10 Asean states and six other countries, to assess negotiations that have entered the last phase amid considerable pressure on India to join the mega free trade pact, according to officials familiar with the matter.
However, domestic industry and affiliates of the Rashtriya Swayamsevak Sangh (RSS) have expressed concerns about RCEP possibly leading to a deluge of Chinese goods in the Indian market.
The meeting, attended by home minister Amit Shah, finance minister Nirmala Sitharaman, commerce minister Piyush Goyal and external affairs minister S Jaishankar, came ahead of a meeting of trade ministers of the 16 countries negotiating the Regional Comprehensive Economic Partnership (RCEP) in Bangkok during October 10-12.
Goyal is expected to participate in the Bangkok negotiations, which will probably be the last meeting of the trade ministers of the proposed RCEP states — 10 members of Asean (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam) and its six FTA partners (China, Japan, India, South Korea, Australia and New Zealand).
A joint statement issued after the last such meeting in Thailand in September said ongoing global uncertainties had added to the urgency to conclude RCEP.
There was no official word on Monday’s meeting but two officials, who spoke on condition of anonymity, said India should be “very careful” in the negotiations because of their wide-ranging implications, particularly on Indian farmers and dairy cooperatives.
The government has received several representations from the dairy industry about concerns on giving concessional access to Australia and New Zealand for supplying milk and milk products.
In recent months, Asean members have proposed the text of RCEP could be finalised and signed this year, with contentious issues such as tariffs and market access to be taken up in an annexure. India has mooted an “auto trigger” safeguard that would come into play when imports, especially from China, crossed a certain threshold.
Under the proposed agreement, India is expected to reduce or eliminate duties on about 74% to 80% of goods imported from China. A Mint report said that China is unwilling to offer tariff elimination in 90% of traded goods.
The department of commerce has been consulting all stakeholders on matters related to RCEP and has had more than 100 consultations in the past six years that covered a wide spectrum of the economy, including agriculture, chemicals, petrochemicals, pharmaceuticals, plastics, textiles, ferrous and non-ferrous metals, automobiles and machinery, one official said.
Industry feedback has been taken on key issues such as rules of origin, sanitary and phytosanitary (SPS) and technical barriers to trade (TBT), anti-dumping, countervailing duties, safeguards and intellectual property rights, this official added.
“What to talk about small farmers, even leading milk cooperatives have expressed concern over RCEP. Those who want India to sign RCEP may argue that giving access to a small country like New Zealand would not make much difference, but once they come in, the entire [business] cooperative character of Indian milk supply chain will collapse. Small farmers with one or two cows would be the worst victims,” a second official said.