BANGKOK -- Japan and other parties negotiating the Regional Comprehensive Economic Partnership (RCEP) free trade agreement must decide whether to forge ahead without India, which has announced its withdrawal from the talks, ahead of a ministerial teleconference scheduled for Tuesday.
Japan and 14 other countries, including China, South Korea and members of the Association of Southeast Asian Nations, aim to sign a treaty by the end of this year. Indian officials were absent when teleconferences among the negotiators were held on June 10 and 11.
The 15 remaining countries released a statement this spring calling on India to return to the talks, only to be rebuffed.
"[The Indian side] has asked us why we're still talking about RCEP," a Japanese negotiator said.
India is strongly concerned that should tariffs be lowered under the RCEP framework, the country would be flooded with cheap products from China and other countries, because New Delhi has recently raised tariffs with the aim of fostering its own industries.
According to The Times of India and other sources, the RCEP talks had been using 2014 as the base year for calculating tariff reductions, but India asked to use 2019 instead to mitigate the damage.
It appears unlikely that India will return to the negotiations. Even if trade liberalization is expected to bring benefits in the future, its domestic industries are currently being hit hard by the novel coronavirus pandemic.
Tensions between China and India have increased this month, including military clashes in a disputed border area. This has made it more difficult for India to show interest in the RCEP, because China is also taking part in negotiations.
The 15 remaining countries have different stances about the framework.
Japan and Australia in particular are cautious that China's presence in the framework will grow if India leaves the talks, while the ASEAN countries, which have high hopes for expanding trade under the RCEP, are concerned that the framework will drift away if negotiations drag out. China aims to reach an agreement this year as planned.
The goal of signing a treaty this year was confirmed in a joint statement at a RCEP summit meeting in November. Of the 20 areas being negotiated, including investments and intellectual property, 18 fields have reached the final stage of legal scrutiny.
A Japanese government source said a decision should be made in the near future over whether to conclude an agreement without India.
"There is almost no way to bring India back," said Junichi Sugawara, a senior research officer at Mizuho Research Institute. "It's reached the point where they should think about enacting the RCEP with 15 countries and get [India] to come back later."
Read more from The Japan News at https://japannews.yomiuri.co.jp/
