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Regional comprehensive Economic Partnership (RCEP)

Analysis of RCEP 3rd summit


 About RCEP-
RCEP Stands for Regional Comprehensive Economic Partnership.
This year 3rd RCEP Summit held in Thailand.
  • It is a proposed FTA(Free Trade Agreement) between 15 countries.
  • 15 countries are ASEAN Nations + 5 FTA partners of ASEAN.
RCEP Countries are-
10 ASEAN (Association of South East Asian Nations)
1.       Laos
2.       Myanmmar
3.       Thailand
4.       Combodia
5.       Brunei
6.       Vietnam
7.       Indonesia
8.       Malaysia
9.       Singapor
10.   Phillippines

5 FTA Partners
1.       Australia
2.       New Zealand
3.       Japan
4.       South Korea
5.       China
   Ø  RCEP negotiations were formally launched in November 2012 at ASEAN summit in Combodia.
  Ø  In june 2019, India the 6th  FTA Partner decide to opt out of the pact.
In 2017, 16 prospective signatories accounted-
        I. Population of 3.4 billion
        II.  GDP (PPP) $49.5 trillion
        III.  39% of world’s GDP

Scenerio of India on RCEP
    1. India has withdraws from RCEP.
    2 .India has expressed its concerns over lowering and elimination of tariffs on products from other countries, as it would negatively affects mainly India’s Domestic Agriculture and industrial sector.
   
  Reasoning of India for not joining RCEP-
   1. Domestic industries and dairy farrmers had strong reservations          about the trade pact.
   2. India's trade deficit with the RCEP nations is 150$ billion.
   3.  China alone account for $54 billion.
   4. The main worries is also over chinese manufactured goods and        dairy products from New Zealand flooding. India market                   hurting domestic interest.
    5. India already have bilateral FTA with most RCEPs nations, but        it has recorded trade deficits with these countries.
     6. The trade agreement was also seen as being detemined to the            governments make in India initiatives.
      7.India has not received any assurance on its demand for more          market.

       India's trade deficits with countries-
       China -  $53.57 Bn
   S.Korea- $12Bn 
   Indonesia - $10.57Bn
   Japan- $9.61Bn
       Australia - $9.61bn
   What could have been its impact
   - Impact on economy, which is already under tremendous pressure after Demonetization and GST.
   - The worst hit manufactures through RCEP could be steel, aluminium, copper, pharmaceutical and textile.
   - It could threaten farm livelihood, autonomy over seeds and also endangers the country's self sufficient dairy sector.
 
       What could India do?
    - India must enhannce export.
    - Build manufacturing capabilities.
    - Make high value goods at competitive prices.
    - focus on innovation and R&D.
    - Improve service Trade.
     
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Comments

  1. UnknownDecember 11, 2019 at 6:58 AM

    According to the present scenario of India, to join RCEP is not right because India already in trade deficit with partner countries.

    ReplyDelete
    Replies
    1. Prashant SharmaDecember 11, 2019 at 7:11 AM

      yes,
      thats why India is not joining RCEP.
      trade deficit is the main issue specially with china.

      Delete
  2. Naritya TewariDecember 11, 2019 at 8:11 AM

    Good info man

    ReplyDelete
  3. Vinod BhattDecember 11, 2019 at 10:11 AM

    I appreciate this

    ReplyDelete
  4. Sahil AroraDecember 11, 2019 at 10:19 AM

    Up to the mark

    ReplyDelete
  5. TEJASWINI MANAPUREDecember 11, 2019 at 10:01 PM

    Thanks for this information..
    Good Analysis...

    ReplyDelete
  6. Sejal SharmaDecember 11, 2019 at 10:11 PM

    Great Information ,Thanks.

    ReplyDelete
  7. Sadhna Singh RajputDecember 12, 2019 at 1:54 AM

    Great start Prashant ..keep going

    ReplyDelete

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