Commerce and Industry Minister Piyush Goyal said on October 21 that the government will protect the interest of domestic industry before entering into the proposed mega free-trade pact RCEP, which is in the last phase of negotiations.
The RCEP (Regional Comprehensive Economic Partnership) agreement is being negotiated among 10 ASEAN members (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam) and their six free-trade pact partners Australia, China, India, Japan, South Korea and New Zealand.
"Every interest of domestic industry and the people of India has to be protected before we execute any free-trade agreement," he told reporters when asked whether RCEP negotiations would be concluded next month. The member countries have fixed a target to conclude the talks in November and sign the agreement in June 2020.
Goyal said the government would protect national interest first and does not fritter away FTAs like "we saw in 2009-10 period of Congress regime, where agreements were done in a hurry".
He alleged that those FTAs did not protect India's interests and there are clauses that are detrimental to India and there are no gains on services. "India will ensure that on services and investments and in every aspect, our national interest is protected first before any agreement is entered into with any country," he added.
A 10-day work programme has been prepared by the 16-nation RCEP grouping, which is negotiating the mega free-trade agreement, to sort out pending 14 issues by October 22 that are hindering the conclusion of talks.
The issues which would not be resolved would go at the leaders' summit, expected to be attended by Prime Minister Narendra Modi next month in Bangkok.
Some sections of Indian industry have raised concerns over the presence of China in the grouping. Various sectors, including dairy, metals, electronics, and chemicals, have urged the government to not agree on duty cuts in these segments.
According to a plan, India is expected to reduce or eliminate duties on about 80 percent of goods imported from China under the proposed agreement.
India may also cut customs duties on 86 percent of imports from Australia and New Zealand, and 90 percent of products from ASEAN, Japan and South Korea, with which India already has a comprehensive free-trade agreement.
The cut or elimination of these duties could be implemented over a period of 5, 10, 15, 20 and 25 years.
There is a plan for an auto-trigger mechanism, wherein India will have the option to increase customs duties if there would be a sudden surge in imports of a specific product, particularly from China, to protect the domestic industry.
As many as 28 rounds of talks have been held at chief negotiators' level and no more rounds are scheduled now.
India has registered trade deficit in 2018-19 with as many as 11 RCEP member countries including China, South Korea and Australia.
The agreement aims to cover issues related to goods, services, investments, economic and technical cooperation, competition and intellectual property rights.
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