The industry has lauded India’s decision not to join the Regional Comprehensive Economic Partnership (RCEP) and has said their concerns over a surge in imports from China have been soothed.
“The government has had extensive consultations with the wide-spectrum of stakeholders,” Vikram Kirloskar, president, Confederation of Indian Industry said. “The objective was to get the first-hand inputs from industry stakeholders and based on that India articulated its position in the last round of negotiations and Ministerial meetings thereafter.”
“Unfortunately, that didn’t find favour with majority of RCEP members,” Mr. Kirloskar added. “The decision taken by India at Bangkok to pull out from RCEP reflects the views of majority of Indian stakeholders.”
Indian industry’s reservations against joining RCEP has come from a number of sectors, including agriculture, dairy, steel, rubber, and textiles, and all of these apprehensions were communicated to the government over a series of consultative meetings the Commerce Minister held in New Delhi and Mumbai.
“In recent months, serious apprehensions and reservations on RCEP have been expressed by a large number of sectors including steel, plastics, copper, aluminium, machine tools, paper, automobiles, chemicals, petro-chemicals and others,” Federation of Indian Chambers of Commerce and Industry (FICCI) president Sandip Somany said. “Further, there were not enough positive developments in the area of trade in services, including easier mobility for our professionals and service-providers.”
Exporter bodies too have lauded the decision to stay out of RCEP. “We welcome the decision in opting out of RCEP,” Engineering Export Promotion Council of India chairman Ravi Sehgal said. “Our MSME unit members were concerned about the possible opening up to Chinese imports; and hence it is a wise decision and will provide certainty to the MSME sector.”
“Vibrant manufacturing holds the key to exports,” Federation of Indian Export Organisations president Sharad Kumar Saraf said. “Duty-free imports from China, which has economy of scale, and sitting on huge inventory and capacity could have jolted the manufacturing beyond recovery and thus crippling exports.”
However, Mr. Saraf called on the government to make manufacturing competitive by reducing the cost of credit, bringing down logistics costs and addressing the inverted duty structure.
