India pulls out of RCEP over unresolved issues
TRADE DEAL Delhi had pushed other nations to address its concern over deficits
BANGKOK: Asian leaders plan to sign the world’s largest regional trade deal next year as India said it’s not ready to join.
Prime Minister Narendra Modi decided not to join the Regional Comprehensive Economic Partnership, or RCEP, in order to protect service workers and farmers, an official told reporters in New Delhi on Monday.
India had pushed the other 15 nations to address its concern over deficits and open their markets to Indian services and investments, the official said.
“India has significant outstanding issues, which remain unresolved,” RCEP countries said in a joint statement on Monday.
“All RCEP Participating Countries will work together to r esolve t hese outstanding issues in a mutually satisfactory way. India’s final decision will depend on satisfactory resolution of these issues.”
India is welcome to join RCEP whenever it’s ready, China viceforeign minister Le Yucheng told reporters in Bangkok on Monday.
Asian leaders had hoped to announce a breakthrough on the trade pact this week.
“It’s the 15 nations that have decided to move forward first,” Le said, adding that a few issues won’t be completed before the end of the year.
“There won’t be any problem for the 15 nations to sign RCEP next year,” he added.
“We are taking an open attitude—whenever India is ready, it’s welcome to get on-board.”
China has sought to accelerate the pact covering a third of the global economy as it faces slowing growth from a trade war with the US, which withdrew from the Trans-pacific Partnership (TPP) after US President Donald Trump took office in 2017.
A deal would further integrate Asia’s economies with China just as the Trump administration urges Asian nations to shun Chinese infrastructure loans and 5G technology.
India has long been the main holdout on due to domestic opposition over worries it would be flooded by cheap goods from China. It made last-minute demands in the run-up to the Bangkok meetings that ended up derailing the talks.
The Philippines said on Saturday that negotiations wouldn’t be completed until February.
US Commerce secretary Wilbur Ross, who is leading a downgraded US delegation to the Association of South-east Asian Nations (Asean), downplayed the significance of RCEP in an interview on Sunday.
Most South-east Asian leaders skipped a summit on Monday with US representatives after Trump decided to avoid the annual meetings for a second straight year.
“RCEP i s not much of an agreement,” Ross told Bloomberg. “It’s not a free trade agreement, it’s not anything remotely like TPP (Trans-pacific Partnership), nor anything remotely like our separate arrangements with Japan and with South Korea. So I don’t think you want to blow that out of proportion. It’s a very low-grade treaty.”