Last-minute India demands key obstacle to RCEP deal
India keeps making last-minute requests after it agreed to terms for the world’s largest regional trade agreement, potentially preventing Asian leaders from announcing a breakthrough next week on the 16-nation pact during a summit in Bangkok, people familiar with the situation said.
In recent days, India angered other negotiators by making additional requests on the Chinabacked pact covering half the world’s population, said the people, who asked not to be identified because the talks are private. Leaders had planned to announce a preliminary deal on November 4 when leaders gather for meetings hosted by the Association of South-East Asian Nations, they said.
Chief negotiators are still confident they can reach a broad agreement on the deal to reduce tariffs, known as the Regional Comprehensive Economic Partnership (RCEP), during a planned meeting on Thursday in Bangkok, the people said. Any announcement would pave the way for nations to finalise the details on the legal framework in the coming monthsA breakthrough after seven years of talks would mark a win for trade liberalisation in an era of rising tariffs and resurgent nationalism. The deal would also further integrate Asia’s economies with China at a time when US President Donald
Trump is seeking to convince the region to shun Chinese infrastructure loans and 5G technology. India, which has raised some tariffs under Prime Minister Narendra Modi, has long been the main holdout on an RCEP deal due to strong domestic opposition over fears the country would be flooded with cheap Chinese goods.
INDIA DEMANDS
Modi, who is fresh off a landslide re-election win in May, agreed to move ahead with the deal after receiving personal assurances from Chinese President Xi Jinping in an informal seaside meeting earlier this month, an Indian official said. China has long pushed to conclude the pact, which also includes Japan, South Korea, Australia, New Zealand and 10 South-East Asian nations.
Still, India came up with new demands after a broad RCEP agreement was concluded, seeking changes in base duties and product-specific rules, according to an Indian official. Two Indian officials said Modi’s government would push for further concessions but is likely to agree to sign due to fears that India could be left out of the announcement, forcing it to negotiate with countries on a bilateral basis.
The Prime Minister Office didn’t immediately respond to a request for comment. A spokeswoman for India’s trade ministry didn’t answer two calls made to her mobile phone. “I have been quite skeptical of a robust RCEP coming to conclusion, due entirely to India’s intransigence,” said Richard Rossow, the Wadhwani chair in US India Policy Studies at the Center for Strategic and International Studies in Washington.