The government will set up a group of ministers (GoM) to look into issues related to the proposed mega free trade agreement RCEP, official sources said.
The government will set up a group of ministers (GoM) to look into issues related to the proposed mega free trade agreement RCEP, official sources said. The GoM will deliberate upon the issues being raised by the industry as well as government departments, they said. The Regional Comprehensive Economic Partnership (RCEP) bloc comprises 10 Asean group members (Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam) and their six FTA partners – India, China, Japan, South Korea, Australia and New Zealand. The first meeting of this group is expected to be held on August 10.
The development assumes significance as domestic industry has raised apprehensions about the presence of China in the bloc, with which India has huge trade deficit. India had trade deficit with as many as 10 member countries, including China, South Korea and Australia, of the RCEP grouping of 16 nations which have been negotiating a mega trade pact since November 2012.
The trade gap with China, Korea, Indonesia and Australia has increased to USD 63.12 billion; USD 11.96 billion; USD 12.47 billion and USD 10.16 billion in 2017-18. It was USD 51.11 billion, USD 8.34 billion, USD 9.94 billion and USD 8.19 billion respectively in the previous financial year, 2016-17. An official from an industry chamber said that giving zero duty access to China would led to flooding of Chinese goods in the domestic market and impact the manufacturing sector.
The pact, negotiations for which started in Cambodian capital Phnom Penh in November 2012, aims to cover goods, services, investments, economic and technical cooperation, competition and intellectual property rights. Pressure is also mounting on India for early conclusion of the proposed trade pact.
Member countries are looking to conclude the talks by end of this year but a lot of issues are yet to be finalised including the number of products over which duties will be eliminated. Domestic steel and other metal industries want these sectors to be kept out of the deal. Under services, India wants greater market access for its professionals in the proposed agreement.