India’s insistence on a safety valve under the Regional Comprehensive Economic Partnership (RCEP) to cover at least half of Chinese imports reportedly resulted in an impasse at the RCEP ministerial meeting in Bangkok last week. The talks remained inconclusive and no joint statement will be issued. A few other nations blamed New Delhi for holding up the deal.
Indian commerce and industry minister Piyush Goyal also demanded that India’s concerns on e-commerce, investment, taxation, micro, small and medium enterprises (MSMEs) and policies framed by local bodies also need to be reworked before it could sign the deal, triggering complaints by negotiators from other countries, which have been pushing for early conclusion of talks, a leading Indian English-language daily reported.
“Participated in deliberations to promote trade & investment to achieve mutual economic growth, while safeguarding the interest of our domestic industry and farmers,” Goyal tweeted after the meeting.
India’s core concern is over a possible surge in Chinese imports once the deal is signed as it has indicated that it can allow up to 80 per cent of goods to enter the country at zero duty. Indian negotiators have now demanded that the automatic safeguard mechanism, which will result in higher duties in case of a sharp jump in imports, should cover more goods instead of 60-65 proposed at the moment.Similarly, it has also demanded that there should be more protection for re-routing of goods via a third country.Dozens of industries, from steel and pharmaceuticals to textiles, have expressed fears of dumping by China, while the dairy industry apprehends subsidised dairy products from New Zealand would flood the Indian market.Goyal also held a series of bilateral meetings in Bangkok with ministers of countries like Japan, China, Singapore, Malaysia, Australia and New Zealand.
Meanwhile, Chinese President Xi Jinping’s reported assurance to Prime Minister NarendraModi during the second informal summit held on October 11-12 at Mamallapuram that India’s concerns would be taken into account implies the two sides may have a separate protocol under RCEP for a balanced trade.]
India is willing to join hands with China to push for an RCEP agreement at an early date, and boost connectivity and anti-terror cooperation, an official Chinese news agency quoted Modi as saying.