RCEP: ‘India doesn’t have quality research or information to negotiate a good trade deal’

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Published: October 28, 2019 9:28:44 PM

Farmers groups and the Congress have criticised the government for not sharing the details of proposed agreement with ASEAN and five other countries.

India Asean trade, RCEP, Narendra Modi, RCEP News, Jairam Ramesh, ProtestIndia is negotiating a comprehensive free trade pact with ASEAN and other countries. (File Photo).

Regional Comprehensive Economic Partnership (RCEP): The country’s effort to finalise a free trade agreement with ASEAN countries is facing protests from several quarters including farmers. Last week, several farmers organisations protested against including agricultural commodities in the Regional Comprehensive Economic Partnership (RCEP) that is under discussion between ASEAN and six other countries – India, China, Japan, Australia, New Zealand, and South Korea. The proposed agreement has also come under the criticism of opposition parties as Congress Rajya Sabha member Jairam Ramesh attacked the agreement saying that it will be the third big jolt to the Indian economy by the Modi government after the demonetisation and GST. Given the mixed record of the country’s previous trade agreements, trade expert and economists have warned about hastily entering into any agreement, particularly that covers agriculture. Financial Express Online’s Krishnanand Tripathi spoke to NR Bhanumurthy, a professor at the National Institute of Public Finance and Policy (NIPFP). Edited excerpts:

Q: The proposed RCEP has come under criticism from several quarters, including farmer groups and the opposition Congress party. Is it good for the country?

A: An increase in trade is always good for the economy, it helps the participating countries but India doesn’t have a good track record of negotiating trade deals. There is a need to increase the trade but there must be a level playing field.

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Q: Farmers are apprehensive about the impact on their livelihood.

A: The apprehensions which have been expressed in various sections are valid. The past history of our trade negotiations and trade agreements doesn’t inspire much confidence. They have not really helped much to our economy, especially if you talk about the WTO and other bilateral trade agreements. The outcomes of these trade agreements are really mixed, particularly if you look at the bilateral trade agreements entered into by the country with some ASEAN members.

Q: Which are the agricultural commodities that will be impacted?

A: We don’t have strong databases to understand or even to negotiate a good trade deal with regard to some of the commodities. Especially, when price fluctuations happen no one knows what will happen to the price of imported commodities, particularly in the case of agricultural commodities.

Q: But the Modi government announced the country’s first agricultural export policy late last year?

A: The problem is that it is difficult to increase the export of agricultural commodities while their imports can be increased very easily.

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Q: You talked about the lack of quality data to negotiate a good trade deal, what about other countries?

A: At least we should know where we are going to benefit and where we are going to lose. On the other hand, these countries (ASEAN and others) have very strong databases and they also know in which sectors they will benefit and what commodities should be focused upon in a trade negotiation. Lack of quality data and research is our problem.

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Q: India is negotiating the RCEP at a time when protectionism is on the rise.

A: The whole world is going in reverse order. A big country like the US is struggling to compete with China and now there are issues (trade war) between them so what would happen to small players like us.

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