New Delhi has backed away from joining a massive multinational trade pact as the other 15 members of the Regional Comprehensive Economic Partnership (RCEP) have agreed on major points of the deal.
The mega trade deal, which is supposed to span from India to New Zealand, is set to include 30 percent of global GDP and half of the world’s population. The RCEP involves 16 countries in the Asia Pacific, including all 10 Southeast Asian nations (ASEAN states) and six of their large trading partners: China, Japan, South Korea, India, Australia, and New Zealand.
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Over the weekend at the Association of Southeast Asian Nations (ASEAN) summit in Bangkok, the nations made a significant step towards officially finalizing the agreement. The 15 participating countries are now set to engage in text-based negotiations for all 20 chapters of the draft and resolve their market access issues before signing it next year, the leaders said in a statement issued on Monday.
However, the pact is moving forward without India, as the country has delayed its decision on joining. One of the fastest-growing world economies, it reportedly fears that lifting tariffs and opening up its domestic market to cheaper Chinese goods could hit its farmers and industries hard, among other things.
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“India has significant outstanding issues, which remain unresolved,” the RCEP countries’ statement said, adding that New Delhi’s final decision “will depend on satisfactory resolution” of those problems.
Prime Minister Narendra Modi said the deal in its present form fails to “reflect the basic spirit” of RCEP, according to Indian public broadcaster Prasar Bharati News Services.
“When I measure the RCEP Agreement with respect to the interests of all Indians, I do not get a positive answer. Therefore, neither the Talisman of Gandhiji nor my own conscience permit me to join RCEP,” Modi said.
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