The Andhra Pradesh government will have to pay up $ 44.71 million in damages if it loses the case in the International Court of Arbitration (ICA) for cancellation of an agreement with UAE-based company Ras Al-Khaimah Investment Authority (RAKIA). This is one of the pitfalls of Free Trade Agreements (FTAs) and investment companies can simply challenge governments on the relatively trivial grounds that they was a reduction in company profit, said Third World Network senior researcher Ranja Sengupta.
Giving a power point presentation on the topic “From WTO to FTAs – The story of RCEP (Regional Comprehensive Economic Partnership),” Ms. Sengupta said that foreign investors could sue governments that enter into FTAs in secret international arbitration cases and the government would end up paying huge compensations. India was facing 20 such cases and the A.P. government was facing lawsuit from the UAE company for stopping mining concession being done on indigenous people’s lands.
She said none of the underdeveloped countries were able to win cases in these courts because it was expensive and also because there was corruption, she charged.
Ms. Sengupta participated in a roundtable organised by former Agriculture Minister and anti-WTO crusader Vadde Sobhanadreswara Rao on the RCEP being held in Hyderabad from July 24 to 28.
Threat to dairy sector
Explaining the implications of RCEP and FTAs, she said India would not be able to meet the competition from countries like China, South Korea, Japan, New Zealand and Australia. These developed countries were pushing for drastic reduction of import duties on 99 categories of goods.
They were also pushing for zero duty on 92 % of the goods, she said.
FTAs would result in dumping of meat and dairy from Australia and New Zealand resulting in the total collapse of the dairy sector that was of great support to the small and marginal farmers in drought years.
Ms. Sengupta explained that RCEPs were not transparent or democratic and the people in general, not just the affected, were left out of the process. The worst to be affected were regular and dairy farmers and workers, plantation owners, workers in manufacturing sector, patients, indigenous communities and women. Human rights were also undermined by these partnerships, she said.
There was a need to oppose the RCEP summit being organised in Hyderabad from July 24, she said.
