Not joining RCEP will protect interests of Indian industry, farmers: Trade experts

NEW DELHI: India's decision to not join the mega free-trade agreement RCEP would help protect interests of domestic industry against unfair competition, according to trade experts.

The experts stated that the government's decision to not join this pact vindicates the concerns of domestic industry from sectors such as dairy and metal.

"This move is a clear reflection that India is carefully considering its interest to protect industry and farmers against unfair competition. It will give huge relief to the dairy sector," Professor at Indian Institute of Foreign Trade (IIFT) Rakesh Mohan Joshi said.

Sharing similar views, engineering exporter and former FIEO (Federation of Indian Export Organisation) president

S C Ralhan said that it was a welcome decision by India.

"Steel and certain engineering players have raised serious objections over this pact. RCEP would not have given any advantage to exporters to explore Chinese market," Ralhan said.

He said participating in the pact would have resulted in increasing imports from China, with which India has a trade deficit of over USD 50 billion.

Presence of China in the grouping has raised concerns as Indian industry was of the view that it would flood domestic market with Chinese goods. Several sectors like IT and pharma have time and again flagged issues with regard to trade barriers in entering the market of the neighbouring country. India has pitched for auto-trigger mechanism in the

RCEP agreement as a remedy against sudden and significant import surge from countries such as China to protect domestic players.

Biswajit Dhar, professor at Jawaharlal Nehru University, said that there were legitimate concerns of Indian industry with regard to this agreement.

"The grouping should have taken into account concerns of all the 16 countries before finalising the agreement. Now, we have to prepare ourselves for the future," he said. Dhar said India always wants to participate in the global trade taking into account the vulnerabilities of all the stakeholders.

"The government should now look at policies which are required to strengthen domestic industry so that we can participate in such agreements," he added.