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India’s rejection of RCEP and free trade will make it poorer and less relevant

beijingwalker

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Nov 4, 2011
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India’s rejection of RCEP and free trade will make it poorer and less relevant
  • The Regional Comprehensive Economic Partnership was an opportunity to recapture India’s success through economic liberalisation
  • India now finds itself isolated and has compromised its influence in a region where economic integration has become a top priority for most countries
Mohamed Zeeshan
Published: 8:45am, 23 Nov, 2020


Demonstrators break up Chinese-made goods on a banner with an inscription reading “Boycott Made in China” before burning them during an anti-China demonstration in Kolkata on June 18. Photo: AFP


A day after the Regional Comprehensive Economic Partnership(RCEP) agreement was concluded in India’s absence, Indian Minister of External Affairs Subrahmanyam Jaishankar launched a scathing attack on trade and globalisation.

“In the name of openness, we have allowed subsidised products and unfair production advantages from abroad to prevail,” he said, asserting that the Indian government had decided to move away from trading arrangements in pursuit of an Atmanirbhar Bharat, or self-reliant India.

“The effect of past trade agreements has been to deindustrialise some sectors,” he said. “The consequences of future ones would lock us into global commitments, many of them not to our advantage.”

Some people might see Jaishankar’s comments as a jibe at China. Indians often complain that the Chinese unfairly subsidise domestic production and then dump their products in the Indian market. Indians also argue that, while China is able to dump its manufactured goods in India, Indian exports in the pharmaceutical and information technology sectors are subject to crippling restrictions by China.

India’s allergy to trade – and the foreign minister’s comments – goes far beyond China, though. For several years, India has struggled to agree on trade liberalisation with myriad partners, from Australia to the European Union and even Sri Lanka. Between 2016 and 2020, India introduced the second-highest number of trade restrictions among all Group of 20 economies, according to the Global Trade Alert database.

Despite its obvious geopolitical value, India was kept out of the Obama administration’s Trans-Pacific Partnership (TPP) trade deal. This was in large part because none of the participating countries believed India would
agree to its terms.

As a result, despite being the world’s fifth-largest economy, India is not even among the world’s top 10 trading powers. This is all the more bizarre when one realises that trade was a large part of India’s post-liberalisation growth burst in the 1990s


In 1988, India’s trade accounted for about 13.5 per cent of its GDP and, 10 years later, it was as much as 24 per cent. Service trade more than doubled as a percentage of GDP and, not surprisingly, India’s real GDP increased by nearly 70 per cent in those 10 years.

This was in stark contrast to the dawdling economic progress made under its protectionist import substitution policies through the 1960s and 1970s. In the 1960s, India’s real GDP only increased by about 40 per cent in 10 years. In the following decade, it rose by a little over a quarter.

India needs to pick up the mantle from its days of economic liberalisation once again. Notwithstanding concernsover Chinese imports, the RCEP was a great opportunity to do just that. Despite its size and complexity, the RCEP is, in many ways, a relatively unambitious trade deal.


By one estimate quoted in The Economist, the deal eliminates about 90 per cent of tariffs but only across a period of 20 years after coming into effect. It hardly touches agriculture – one of India’s key political concerns, which drives protectionism. As The Economistpointed out, Japan will maintain high import duties on some “politically sensitive” agricultural products such as
rice, wheat, dairyand sugar.

The fact India was not sufficiently confident about its domestic economy to sign up to even such an unambitious deal is worrying and will send the wrong signals to foreign investors.
Worse, Jaishankar’s caustic tirade is likely to undermine India’s already floundering trade negotiations with the rest of the world. Indian diplomats are, for instance, working hard to convince the European Union of New Delhi’s commitment to more openness.

India’s antitrade posture will also have geopolitical costs. Membership in the RCEP would have given India the opportunity to be a balancing power against Chinese hegemonyin Asia. Its participation would have been particularly crucial at a time when the United States has been withdrawing from the region, and countries, especially in Southeast Asia, were looking for diverse partnerships.

For these reasons, nations such as Japan were strong advocates for India’s inclusion in the RCEP, even after New Delhi walked out of discussions last year.


Now, however, India finds itself isolated and has significantly compromised its influence in a region where economic integration has become a top priority for most.

The RCEP comes amid heightened tensions between China and its neighbours. Yet, the fact that Japan, South Korea and Southeast Asian nations have all been willing to put political troubles aside for the sake of economic tiesshows Asia is strongly committed to globalisation.

Meanwhile, even relative to the US, India might now find its antitrade posture out of resonance. As part of his renewed outreach in the Asia-Pacific, US President-elect Joe Biden is likely to consider rejoining the TPP – a deal he championed as vice-president in the Obama administration.

Trade and globalisation are key interests among Asia-Pacific nations. If New Delhi aspires for regional leadership and influence, it has to recognise this and present itself as a willing partner in region-wide economic integration. If it isolates itself through protectionist rhetoric under the guise of self-reliance, it is likely to pay a heavy economic price and will render itself less relevant in Asian geopolitics.

 

casual

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Jan 8, 2011
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Not really. If India joined, it would lose whatever little manufacturing and agriculture industries it has as India is not competitive at all. Also rcep nations ain't interested in india's call center services since they are mostly none english speaking.
 
Oct 6, 2020
2,517
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India
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India’s rejection of RCEP and free trade will make it poorer and less relevant
  • The Regional Comprehensive Economic Partnership was an opportunity to recapture India’s success through economic liberalisation
  • India now finds itself isolated and has compromised its influence in a region where economic integration has become a top priority for most countries
Mohamed Zeeshan
Published: 8:45am, 23 Nov, 2020


Demonstrators break up Chinese-made goods on a banner with an inscription reading “Boycott Made in China” before burning them during an anti-China demonstration in Kolkata on June 18. Photo: AFP


A day after the Regional Comprehensive Economic Partnership(RCEP) agreement was concluded in India’s absence, Indian Minister of External Affairs Subrahmanyam Jaishankar launched a scathing attack on trade and globalisation.

“In the name of openness, we have allowed subsidised products and unfair production advantages from abroad to prevail,” he said, asserting that the Indian government had decided to move away from trading arrangements in pursuit of an Atmanirbhar Bharat, or self-reliant India.

“The effect of past trade agreements has been to deindustrialise some sectors,” he said. “The consequences of future ones would lock us into global commitments, many of them not to our advantage.”

Some people might see Jaishankar’s comments as a jibe at China. Indians often complain that the Chinese unfairly subsidise domestic production and then dump their products in the Indian market. Indians also argue that, while China is able to dump its manufactured goods in India, Indian exports in the pharmaceutical and information technology sectors are subject to crippling restrictions by China.

India’s allergy to trade – and the foreign minister’s comments – goes far beyond China, though. For several years, India has struggled to agree on trade liberalisation with myriad partners, from Australia to the European Union and even Sri Lanka. Between 2016 and 2020, India introduced the second-highest number of trade restrictions among all Group of 20 economies, according to the Global Trade Alert database.

Despite its obvious geopolitical value, India was kept out of the Obama administration’s Trans-Pacific Partnership (TPP) trade deal. This was in large part because none of the participating countries believed India would
agree to its terms.

As a result, despite being the world’s fifth-largest economy, India is not even among the world’s top 10 trading powers. This is all the more bizarre when one realises that trade was a large part of India’s post-liberalisation growth burst in the 1990s


In 1988, India’s trade accounted for about 13.5 per cent of its GDP and, 10 years later, it was as much as 24 per cent. Service trade more than doubled as a percentage of GDP and, not surprisingly, India’s real GDP increased by nearly 70 per cent in those 10 years.

This was in stark contrast to the dawdling economic progress made under its protectionist import substitution policies through the 1960s and 1970s. In the 1960s, India’s real GDP only increased by about 40 per cent in 10 years. In the following decade, it rose by a little over a quarter.

India needs to pick up the mantle from its days of economic liberalisation once again. Notwithstanding concernsover Chinese imports, the RCEP was a great opportunity to do just that. Despite its size and complexity, the RCEP is, in many ways, a relatively unambitious trade deal.


By one estimate quoted in The Economist, the deal eliminates about 90 per cent of tariffs but only across a period of 20 years after coming into effect. It hardly touches agriculture – one of India’s key political concerns, which drives protectionism. As The Economistpointed out, Japan will maintain high import duties on some “politically sensitive” agricultural products such as
rice, wheat, dairyand sugar.

The fact India was not sufficiently confident about its domestic economy to sign up to even such an unambitious deal is worrying and will send the wrong signals to foreign investors.
Worse, Jaishankar’s caustic tirade is likely to undermine India’s already floundering trade negotiations with the rest of the world. Indian diplomats are, for instance, working hard to convince the European Union of New Delhi’s commitment to more openness.

India’s antitrade posture will also have geopolitical costs. Membership in the RCEP would have given India the opportunity to be a balancing power against Chinese hegemonyin Asia. Its participation would have been particularly crucial at a time when the United States has been withdrawing from the region, and countries, especially in Southeast Asia, were looking for diverse partnerships.

For these reasons, nations such as Japan were strong advocates for India’s inclusion in the RCEP, even after New Delhi walked out of discussions last year.


Now, however, India finds itself isolated and has significantly compromised its influence in a region where economic integration has become a top priority for most.

The RCEP comes amid heightened tensions between China and its neighbours. Yet, the fact that Japan, South Korea and Southeast Asian nations have all been willing to put political troubles aside for the sake of economic tiesshows Asia is strongly committed to globalisation.

Meanwhile, even relative to the US, India might now find its antitrade posture out of resonance. As part of his renewed outreach in the Asia-Pacific, US President-elect Joe Biden is likely to consider rejoining the TPP – a deal he championed as vice-president in the Obama administration.

Trade and globalisation are key interests among Asia-Pacific nations. If New Delhi aspires for regional leadership and influence, it has to recognise this and present itself as a willing partner in region-wide economic integration. If it isolates itself through protectionist rhetoric under the guise of self-reliance, it is likely to pay a heavy economic price and will render itself less relevant in Asian geopolitics.

South China Morning Post article written by a Pakistani :rofl: .

Yeah sure we would become poor af, very poor🤣😂.
 
Oct 6, 2020
2,517
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Country
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Counter the content of the article instead of the ethnicity of the person. He makes valid points.
It wouldn’t have helped us anyway as our manufacturing sector is not mature now and our companies are not big global players except TATA, Mahindra and INFOSYS etc.

Our current GDP growth is coming from services sector hence it is time till we become a large scale manufacturing country.
 

lonelyman

SENIOR MEMBER
Feb 19, 2015
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India’s rejection of RCEP and free trade will make it poorer and less relevant
  • The Regional Comprehensive Economic Partnership was an opportunity to recapture India’s success through economic liberalisation
  • India now finds itself isolated and has compromised its influence in a region where economic integration has become a top priority for most countries
Mohamed Zeeshan
Published: 8:45am, 23 Nov, 2020


Demonstrators break up Chinese-made goods on a banner with an inscription reading “Boycott Made in China” before burning them during an anti-China demonstration in Kolkata on June 18. Photo: AFP


A day after the Regional Comprehensive Economic Partnership(RCEP) agreement was concluded in India’s absence, Indian Minister of External Affairs Subrahmanyam Jaishankar launched a scathing attack on trade and globalisation.

“In the name of openness, we have allowed subsidised products and unfair production advantages from abroad to prevail,” he said, asserting that the Indian government had decided to move away from trading arrangements in pursuit of an Atmanirbhar Bharat, or self-reliant India.

“The effect of past trade agreements has been to deindustrialise some sectors,” he said. “The consequences of future ones would lock us into global commitments, many of them not to our advantage.”

Some people might see Jaishankar’s comments as a jibe at China. Indians often complain that the Chinese unfairly subsidise domestic production and then dump their products in the Indian market. Indians also argue that, while China is able to dump its manufactured goods in India, Indian exports in the pharmaceutical and information technology sectors are subject to crippling restrictions by China.

India’s allergy to trade – and the foreign minister’s comments – goes far beyond China, though. For several years, India has struggled to agree on trade liberalisation with myriad partners, from Australia to the European Union and even Sri Lanka. Between 2016 and 2020, India introduced the second-highest number of trade restrictions among all Group of 20 economies, according to the Global Trade Alert database.

Despite its obvious geopolitical value, India was kept out of the Obama administration’s Trans-Pacific Partnership (TPP) trade deal. This was in large part because none of the participating countries believed India would
agree to its terms.

As a result, despite being the world’s fifth-largest economy, India is not even among the world’s top 10 trading powers. This is all the more bizarre when one realises that trade was a large part of India’s post-liberalisation growth burst in the 1990s


In 1988, India’s trade accounted for about 13.5 per cent of its GDP and, 10 years later, it was as much as 24 per cent. Service trade more than doubled as a percentage of GDP and, not surprisingly, India’s real GDP increased by nearly 70 per cent in those 10 years.

This was in stark contrast to the dawdling economic progress made under its protectionist import substitution policies through the 1960s and 1970s. In the 1960s, India’s real GDP only increased by about 40 per cent in 10 years. In the following decade, it rose by a little over a quarter.

India needs to pick up the mantle from its days of economic liberalisation once again. Notwithstanding concernsover Chinese imports, the RCEP was a great opportunity to do just that. Despite its size and complexity, the RCEP is, in many ways, a relatively unambitious trade deal.


By one estimate quoted in The Economist, the deal eliminates about 90 per cent of tariffs but only across a period of 20 years after coming into effect. It hardly touches agriculture – one of India’s key political concerns, which drives protectionism. As The Economistpointed out, Japan will maintain high import duties on some “politically sensitive” agricultural products such as
rice, wheat, dairyand sugar.

The fact India was not sufficiently confident about its domestic economy to sign up to even such an unambitious deal is worrying and will send the wrong signals to foreign investors.
Worse, Jaishankar’s caustic tirade is likely to undermine India’s already floundering trade negotiations with the rest of the world. Indian diplomats are, for instance, working hard to convince the European Union of New Delhi’s commitment to more openness.

India’s antitrade posture will also have geopolitical costs. Membership in the RCEP would have given India the opportunity to be a balancing power against Chinese hegemonyin Asia. Its participation would have been particularly crucial at a time when the United States has been withdrawing from the region, and countries, especially in Southeast Asia, were looking for diverse partnerships.

For these reasons, nations such as Japan were strong advocates for India’s inclusion in the RCEP, even after New Delhi walked out of discussions last year.


Now, however, India finds itself isolated and has significantly compromised its influence in a region where economic integration has become a top priority for most.

The RCEP comes amid heightened tensions between China and its neighbours. Yet, the fact that Japan, South Korea and Southeast Asian nations have all been willing to put political troubles aside for the sake of economic tiesshows Asia is strongly committed to globalisation.

Meanwhile, even relative to the US, India might now find its antitrade posture out of resonance. As part of his renewed outreach in the Asia-Pacific, US President-elect Joe Biden is likely to consider rejoining the TPP – a deal he championed as vice-president in the Obama administration.

Trade and globalisation are key interests among Asia-Pacific nations. If New Delhi aspires for regional leadership and influence, it has to recognise this and present itself as a willing partner in region-wide economic integration. If it isolates itself through protectionist rhetoric under the guise of self-reliance, it is likely to pay a heavy economic price and will render itself less relevant in Asian geopolitics.


Poor India, simply put, it’s industry and agriculture are not competitive despite RSS goons bragging all day
 

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