India’s reservations regarding the potential adverse impact of eliminating duties on its local manufacturing and job creation is understood to be slowing down the Regional Comprehensive Economic Partnership (RCEP) negotiations.
The RCEP is a proposed mega Free Trade Agreement (FTA) involving 16 Asia Pacific nations including India and China, and aims, among other things to liberalise investment norms in the region, besides boosting trade by dismantling most tariff and non-tariff barriers.
Many economists and scholars have pointed that the growth potential of Asia Pacific region is immense and if we remove or reduce barriers in trade, we can reap its full potential. However, the pace at which RCEP (which seeks to remove such trade barriers) negotiations are going, it is not expected to see the light of day any soon.
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On Indian side, Indian companies and trade bodies, including CII, are pointing out their concerns. They are of the opinion that the RCEP will lead to low or no import duties which would hit the Indian industries and eventually render people jobless. They also opine that it will hit Indian manufacturing industries and eventually ‘Make in India’ initiative would be affected.
About Regional Comprehensive Economic Partnership (RCEP):
To know in detail about the organisation, read this International Organisation: Regional Comprehensive Economic Corridor
Regional Comprehensive Economic Partnership (RCEP) is a proposed free trade agreement (FTA) b/w the ten member states of the Association of Southeast Asian Nations (ASEAN), viz. Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam, and the six states with which ASEAN has existing free trade agreements, viz. Australia, China, India, Japan, South Korea and New Zealand.
RCEP will cover trade in goods, trade in services, investment, economic and technical cooperation, intellectual property, competition, dispute settlement and other issues.
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