02-25-2016 14:44 BJT
By Wang Haixia, South Asia, Southeast Asia and Oceania Center of China Institute of Contemporary International Relations
Regional Comprehensive Economic Partnership (RCEP) negotiations have faced increasing pressure after conclusion of the Trans-Pacific Partnership Agreement (TPP). RCEP was launched by ten ASEAN countries, which covers 16 countries including China, Japan, Republic of Korea, Australia, New Zealand and India to boost free trade by reducing tariffs.
As an emerging country and economic growth engine, India holds a
significant position for RCEP. For India, the TPP has excessive trade
liberalization measures, along with stiff economic constraints and a
high-entry threshold. But the RCEP is more flexible and India has good
reasons to favor RCEP participation.
New Delhi can expand global trade share and boost national economic growth. New Delhi hopes to increase commodities and services exports to 900 billion US dollars in the 2019-2020 financial year; a rise from 465.9 billion US dollars in the 2013-2014 financial year; lifting its global export share from 2% to 3.5%.
Since India offers advantages in the fields of information and communication technology, medical treatment, education and more, RCEP could bring greater trade preferences and increase global market share.
New Delhi can promote its strategic and economic position. The Asian-Pacific region is one of the most vibrant areas in bilateral and multilateral free trade agreement negotiations. The TPP, led by the US, and RCEP, led by China, cover 12 countries and 16 countries respectively, accounting for 40% and 30% of economic aggregate of the world.
If RCEP gets signed, it will be the largest free trade zone in the world with more than 3 billion people participating. Development of the regional free trade mechanism is vital to the new trade system. If India opposes any regional free trade mechanism, it will probably be excluded from the new Asian-Pacific trade system, which doesn't conform with India's pursuit of a major power position.
India has engaged in a "moving eastward" policy. In recent years, New Delhi has upgraded its "looking eastward" policy to "moving eastward," and paid more attention to its political and economic relations with ASEAN. RCEP would advance the "moving eastward" policy. Additionally, New Delhi fears the TPP would negatively impact its exports, but RCEP can enlarge India's economy.
Currently, India has put forward three different tariff preferences during RCEP negotiations. India offered a 42.5% bilateral tariff concession to Australia, New Zealand and China, which have not signed free trade agreements with New Delhi.
For those which have signed free trade agreements, India offered a 65% tariff concession to Japan and Republic of Korea, 80% tariff concession to ASEAN. Additionally, 65% tariff concession to ASEAN will take effect immediately, and the rest 15% will be completed in the next 10 years.
New Delhi hopes to gain more preferential policies and market access in the field of IT (international technology). Since India's degree of trade freedom is low, the openness will bring high pressure. Nevertheless, RCEP participation will do more good than harm.
The 11th round of RCEP negotiations was held on Feb.14-19 in Bandar Seri Begawan, capital of Brunei. Negotiations had consisted of four group meetings: primary meeting and cargo trade, service trade, investment and rule of origin.
Negotiations had focused on market access talks and text discussions in terms of cargo, service and investment, and the 2016 negotiation plan. The 12th round of negotiations will be held on April 22-29 in Perth, Australia.
( The opinions expressed here do not necessarily reflect the opinions of Panview or CCTV.com. )
Regional Comprehensive Economic Partnership (RCEP) negotiations have faced increasing pressure after conclusion of the Trans-Pacific Partnership Agreement (TPP). RCEP was launched by ten ASEAN countries, which covers 16 countries including China, Japan, Republic of Korea, Australia, New Zealand and India to boost free trade by reducing tariffs.
New Delhi can expand global trade share and boost national economic growth. New Delhi hopes to increase commodities and services exports to 900 billion US dollars in the 2019-2020 financial year; a rise from 465.9 billion US dollars in the 2013-2014 financial year; lifting its global export share from 2% to 3.5%.
Since India offers advantages in the fields of information and communication technology, medical treatment, education and more, RCEP could bring greater trade preferences and increase global market share.
New Delhi can promote its strategic and economic position. The Asian-Pacific region is one of the most vibrant areas in bilateral and multilateral free trade agreement negotiations. The TPP, led by the US, and RCEP, led by China, cover 12 countries and 16 countries respectively, accounting for 40% and 30% of economic aggregate of the world.
If RCEP gets signed, it will be the largest free trade zone in the world with more than 3 billion people participating. Development of the regional free trade mechanism is vital to the new trade system. If India opposes any regional free trade mechanism, it will probably be excluded from the new Asian-Pacific trade system, which doesn't conform with India's pursuit of a major power position.
India has engaged in a "moving eastward" policy. In recent years, New Delhi has upgraded its "looking eastward" policy to "moving eastward," and paid more attention to its political and economic relations with ASEAN. RCEP would advance the "moving eastward" policy. Additionally, New Delhi fears the TPP would negatively impact its exports, but RCEP can enlarge India's economy.
Currently, India has put forward three different tariff preferences during RCEP negotiations. India offered a 42.5% bilateral tariff concession to Australia, New Zealand and China, which have not signed free trade agreements with New Delhi.
For those which have signed free trade agreements, India offered a 65% tariff concession to Japan and Republic of Korea, 80% tariff concession to ASEAN. Additionally, 65% tariff concession to ASEAN will take effect immediately, and the rest 15% will be completed in the next 10 years.
New Delhi hopes to gain more preferential policies and market access in the field of IT (international technology). Since India's degree of trade freedom is low, the openness will bring high pressure. Nevertheless, RCEP participation will do more good than harm.
The 11th round of RCEP negotiations was held on Feb.14-19 in Bandar Seri Begawan, capital of Brunei. Negotiations had consisted of four group meetings: primary meeting and cargo trade, service trade, investment and rule of origin.
Negotiations had focused on market access talks and text discussions in terms of cargo, service and investment, and the 2016 negotiation plan. The 12th round of negotiations will be held on April 22-29 in Perth, Australia.
( The opinions expressed here do not necessarily reflect the opinions of Panview or CCTV.com. )
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