Protectionism and import substitutions are not the best ways to ensure the prosperity of all, especially the poorest of the poor, but keeping the economy open to the world is, senior Singaporean minister Tharman Shanmugaratnam has said.
After walking out of negotiations on the 16-nation RCEP free trade agreement, the government said it would renegotiate its existing FTA and redouble its efforts to conclude other trade negotiations.
Countries like China, South Korea and Japan may boast of low tariffs but they have erected huge non-tariff barriers (NTBs), most of which are tailored to mask the ferocity of trade protectionism, in a bid to control the imports they deem undesirable.
India’s decision to pull out of RCEP means its policy on access to inexpensive drugs will not be under pressure.
Moscow has made a decision to hold talks with Delhi on a preferential trade agreement (PTA) with between the Eurasian Economic Union (EAEU) bloc and India.
Despite the country now having backed out of the mega trade deal, its renewed interest on its other trade pacts, several of which have failed to deliver the results expected, has set the tone for its focus in the coming year.
South Korea has secured 16 free trade partners — 12 countries and four trade blocs — around the globe since it started pursuing bilateral free trade agreements two decades ago.
India is making efforts to speed up free trade negotiations with the EFTA countries comprising Switzerland, Norway, Iceland and Leichtenstein in parallel with its discussions with the European Union on a similar pact.
The proposed free trade agreement between India and Mauritius is nearing finalisation as both the sides have concluded the negotiations for the pact.
For New Delhi, though, RCEP is first and foremost an economic deal that could hurt its more vulnerable industries and lead to near-term pain.
The withdrawal of India from the RCEP as also the changed ground truths call for a recalibration of the FTP which is not only in tune with the changing times, but factor in future uncertainties as well.
Commerce and Industry Minister Piyush Goyal hailed Prime Minister Narendra Modi for India’s decision to opt-out of the RCEP noting that it was nothing more than a FTA between India and China.
The Trump administration is setting its sights on another trade agreement with India.
Whereas Japan took the lead to establish the TPP without the United States, Tokyo does not desire a RCEP without India because it would create a China-led trading bloc.
Regional dialogues on Indo-Pacific cooperation set to be held in New Delhi this weekend will provide ASEAN countries with an opportunity to persuade India to rejoin a landmark trade deal it walked away from last month.
Piyush Goyal said the government took the bold decision in the national interest because clearly, the RCEP had become nothing but an India-China FTA which "nobody wants".
But the EU wants issues such as market access for automobiles, wines, and govt procurement issues resolved first.
The European Union said it was hopeful of forward movement in negotiations with India on the long-pending free trade agreement, and favoured opening separate talks for an investment protection treaty.
The RCEP did not "adequately" address India’s concerns over issues like non-tariff barriers to trade and opaqueness in subsidy regime in some countries, which forced it to back out from the trade deal, the Indian government informed.
India and the EU need to sort out complex issues such as government procurement, labour standards and sustainability as part of the bilateral free trade talks that have been stuck for more than half a decade.