India has prepared a double strategy ahead of talks under the Regional Comprehensive Economic Partnership (RCEP) which is expected to take place on August 24-26 in Nay Pyi Taw, Myanmar.
The RCEP is seen as an answer to the US-led Trans-Pacific Partnership (TPP) agreement. It is being negotiated among the 10-member ASEAN economies—Singapore, Malaysia, Thailand, Vietnam, Indonesia, the Philippines, Myanmar, Laos, Cambodia and Brunei—and six of its free trade partners—China, Australia, Japan, South Korea, New Zealand and India.
India has done its homework as it sits down to cull out a deal in the RCEP, which is being spearheaded by China. So far there have been eight rounds of talks.
“Our strategy is clear. We will offer a certain set of tariff lines for ASEAN, South Korea and Japan, with whom we have free trade agreements (FTAs) and our other non-FTA partners. We cannot offer the same to everyone. With the countries with which we have FTAs we cannot go above a certain level that has already been fixed,” a top official in the ministry of commerce and industry told Business Standard.
According to the official, India had already informally put forward the proposal during the inter-ministerial session that took place in Kuala Lumpur,Malaysia, earlier this month. During the meeting it was decided that India would offer 80-85 % of tariff lines for duty cuts to South Korea and Japan, 70-75 % tariff lines to ASEAN, and about 40-50 % to China, Australia and New Zealand.
Indian industry, especially the automobiles, steel, textiles, dairy and rubber sectors, are concerned that having a trade deal which includes China could hurt their interests.
“We are aware that some of the sectors have taken a beating. Why only China, we have taken a beating on coffee, cardamom and other agricultural products from Vietnam. That is why we are not offering everything to everyone. It has to be approached differently and we are aware of industry’s concerns,” the official said.