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Automobiles, textiles, dairy, machinery, rubber and spices are some of the sectors that India has opted for protecting in the Regional Comprehensive Economic Partnership (RCEP) pact it is negotiating with 15 other countries including powers such as China and Japan.
The Commerce Ministry has asked the Indian industry to give it a list of specific items that it seeks to insulate from duty cuts backed with valid reasons in order to fine tune the list of offers it has to make to all members in February in Pattaya, Thailand according to a Government official.
Other RCEP members include the 10-member Asean block, South Korea, New Zealand and Australia.
“While we have indicated the broad sectors that we seek to protect, we will have to specifically mention the items when we make our initial offers. We hope to get some useful inputs from the industry,” a Commerce Ministry official told BusinessLine .
Other sectors that India would protect include basic metals, some parts of steel and electrical and mechanical machinery, the official added. Most of these sectors have been protected by India in the FTAs (Free Trade Agreements) it has already signed with other countries and regions such as Japan, South Korea and the Asean.
While India is keen to be part of the RCEP, which will be the largest trading bloc in the world involving 45 per cent of the world’s population with a combined gross domestic product of $21.4 trillion, its industry and farmers have several apprehensions.
Manufacturers are mostly concerned about the threat China will pose once duties are eliminated or substantially reduced under the free trade pact.
Farmers’ worriesThe farm sector, on the other hand, is apprehensive of competition from some of the South East Asian countries as well as New Zealand and Australia.
“It is evident from the FTAs Australia and New Zealand have signed with China that they want more market access for their dairy products. Deeper tariff cuts on agriculture products will intensify agriculture crisis in India,” pointed out Yudhvir Singh, Convenor, Indian Coordination Committee of Farmers’ Movements, in a press release protesting against the negotiations here earlier this month.
To what extent India will manage its industry and agriculture in its initial offers also depends on what Indonesia, which is chairing the RCEP negotiations, decides is acceptable.
While India, China and South Korea want to eliminate duties on just 40 per cent of items, Japan, Australia and New Zealand are pushing for 80 per cent.
The RCEP will also include trade in services and investments. Japan wants the grouping to have more stringent patent norms that India is resisting.
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