* RCEP negotiations started in 2013 but acquired fresh impetus after the rise of protectionism globally that saw the US pulling out of the Trans-Pacific Partnership
* India has seen its trade deficit with most countries rising manifold after an FTA was operationalized
India on Monday decided against joining The Regional Comprehensive Economic Partnership (RCEP), a trade pact that has been spearheaded by China with the 10-nation Asean and four others. Mint explains what was at stake for India and why it opted out.
1) Why did the RCEP deal become important?
RCEP negotiations started in 2013 but acquired fresh impetus after the rise of protectionism globally that saw the US pulling out of the Trans-Pacific Partnership. The continuing US-China trade war is hurting economies of South-East Asia. In the face of growing protectionism around the world, the free-trade pact, RCEP, through commitments of tariff elimination, can safeguard the export markets of these economies. India and China account for half of the GDP of the grouping. The hope was that early conclusion of RCEP will potentially open up India’s vast market to the other 15 countries in the grouping.
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