PM Narendra Modi pitches for a ‘balanced’ trade pact among Asean nations
A proposed trade pact, known as the Regional Comprehensive Economic Partnership, could create a larger but integrated market, but India has two key reservations – dismantling of import tariffs and impact on the service sector.india Updated: Jan 25, 2018 23:22 IST
Prime Minister Narendra Modi on Thursday pitched for a balanced and mutually beneficial Regional Comprehensive Economic Partnership, a trade pact being negotiated by 16 nations, as Asean countries continued to mount pressure on India to help seal it this year.
The proposed trade pact, also known as the RCEP, could create a larger but integrated market comprising nearly half the world’s population and a third of the world’s GDP. However, India has two key reservations in this regard – dismantling of import tariffs and impact on the service sector.
Many leaders, including Singapore Prime Minister Lee Hsien Loong, batted for the early sealing of the pact. Terming the RCEP as “a historic opportunity to create the world’s largest trading bloc” during his address at the plenary of the India-ASEAN summit, Loong said: “This pact represents a historic opportunity to establish the world’s largest trading bloc, enabling our businesses to harness the region’s true potential.”
“One repeated refrain was about the RCEP, with ASEAN leaders wanting to move forward with the negotiations. Prime Minister Narendra Modi expressed the hope for a balanced outcome that will be mutually beneficial to all parties,” said Preeti Saran, secretary (east) in the external affairs ministry.
India is not comfortable with dismantling many import tariffs in keeping with the demands of ASEAN countries because that would also mean allowing duty-free access to Chinese goods, leading to the unsustainable outpricing of Indian products. “The service sector, especially mobility issues and provision of work visas for Indian professions, is another area of concern,” said an official. “As everybody agrees that the RCEP consists of goods, investment and services, we need a satisfactory outcome on services too.”
Ten ASEAN countries, including China, South Korea, Japan, Australia and New Zealand, constitute the RCEP bloc. Commerce and industry minister Suresh Prabhu had placed emphasis on “addressing the sensitivities and aspirations of all participants” ahead of the summit.
Prime Minister Modi held bilateral talks with his Thai counterpart, General Prayut Chan-o-cha, on strengthening cooperation in the strategic areas of trade, defence and security.
Saran described the common theme in Modi’s bilateral meetings with the leaders of Vietnam, Myanmar, Philippines, Thailand and Singapore as “the recognition of India’s role in strengthening ASEAN unity in Indo-Pacific regional architecture”. India and Vietnam will host the joint commission meeting at the foreign minister-level later this year.
‘Nari shakti’ evoked
Prime Minister Modi evoked ‘nari shakti’ (women power) when he interacted with the leaders of the ten South East Asian countries with a focus on maritime cooperation during a retreat at the Rashtrapathi Bhavan on Thursday.
During the talks, Modi made a reference to the Navika Sagar Parikrama — India’s first ever circumnavigation expedition of globe by an all-women crew. The voyage was flagged off from Goa in September of last year and is expected to be completed by March 2018.
The Prime Minister told the leaders that a similar feat could be achieved by a joint India-Asean team.
Meanwhile, external affairs ministry officials said the Asean leaders praised Prime Minister Modi’s speech at the World Economic Forum at Davos on Tuesday. “The Asean leaders appreciated the speech by Prime Minister Modi at Davos, which was well received”, Preeti Saran, secretary east in the external affairs ministry said.