The Commerce Ministry is holding a series of meetings with various industry associations on tariff elimination under the proposed 16-member Regional Comprehensive Economic Partnership pact as it prepares for the crucial round of negotiations this week in China followed by a meeting of Trade Ministers.
Commerce & Industry Minister Piyush Goyal interacted with representatives from various export promotion councils such as engineering, auto, chemical, pharmaceutical, leather, agriculture, marine & food processing, dairy, copper, zinc, aluminium, textiles and gems in separate meetings in Mumbai on Monday to discuss their specific concerns on the RCEP.
This will be followed by more meetings in New Delhi on Tuesday between industry representatives and senior government officials.
“The Indian industry, especially sectors such as steel, auto, textiles, and engineering goods, has been apprehensive about taking on commitments to eliminate tariffs for RCEP members, especially China. The meetings have been arranged to take on board their concerns before India decides on its strategy for the negotiations to begin in China,” a government official told BusinessLine.
Mega trade deal
The RCEP is a mega trade pact being negotiated between the 10-member ASEAN, India, China, South Korea, Japan, Australia and New Zealand. With the countries missing the December 2018 deadline for concluding the pact due to change in regimes in some ASEAN countries and India’s unresolved concerns on tariff elimination in goods and low offers in services, most members are determined to sign the agreement by the end of 2019.
The 27th round of RCEP negotiations will be held this week in Zhengzhou, capital of central China’s Henan Province. This will be followed by RCEP Trade Ministers meeting in Beijing on August 2-3. “There is no doubt that members are serious about concluding the RCEP talks this year. This message was given clearly to India when the ‘ASEAN troika’, including trade ministers from Indonesia and Thailand and the ASEAN Secretary General, called upon Goyal earlier this month. That is why the forthcoming negotiations are going to be crucial and India has to make its point forcefully,” the official said.
The Indian industry, across sectors, is not willing to face unbridled competition from RCEP member countries, particularly China. “The list of items that various Ministries and Departments have handed over for protection against tariff cuts in case India signs the RCEP is so large that if all are included there would hardly be any items left for tariff elimination,” the official said.
Largest free trade zone
Despite the challenges to be faced by industry, the government is keen to be part of the pact as once implemented the RCEP could be the largest free trade zone in the world as member countries account for 25 per cent of global GDP, 30 per cent of global trade, 26 per cent of global foreign direct investment (FDI) flows and 45 per cent of the total population.