RCEP trade deal

It is unsurprising that reputable experts say that India’s exclusion actually makes the deal better for all involved

A joint statement issued by the 16 states involved in the Regional Comprehensive Economic Partnership (RCEP) says that 15 members have concluded negotiations and agreed on the text, with the formal signing due for 2020. Those in agreement on the RCEP, an Asia-Pacific economic deal, include economic powerhouses China, Japan, and Australia while the only holdout is India. Even though PM Modi was at the meeting in Bangkok to share the stage with the leaders of the 15 nations in agreement, he cut an awkward figure. Modi’s decision is based on demands for concessions that the other 15 countries consider untenable. Negotiators worked for weeks to bring the deal to a conclusion at the summit, but India made fresh demands at the eleventh hour, reports say. Simply put, India believes it deserves special treatment. Even though India claims it only wanted a level-playing field, the fact is that the free trade deal would have seen uncompetitive Indian industries such as dairy farming overrun by Australia and New Zealand, and manufacturing giving way to Chinese and emerging Vietnamese exporters.

After the RCEP joint statement was issued, groups such as the Swadeshi Jagran Manch (SJM), the economic wing of the nationalist Rashtriya Swayamsevak Sangh, was celebrating. Former SJM members can also be credited for taking India’s booming pre-2014 economy all the way to teetering in just five years. Former SJM members are among those behind demonetisation, the disaster that almost destroyed India’s economy. Renowned Indian-American economist Jagdish Bhagwati once said that if RSS ideologues were economists, then Bhagwati was a Bharatnatyam dancer. So it is unsurprising that reputable economists and international trade experts have been saying that India’s exclusion actually makes the deal better for all involved. India was described as having “low ambition” and not even being well integrated into the Asia-Pacific region. 

Published in The Express Tribune, November 6^th, 2019.

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