Underlining that the Regional Comprehensive Economic Partnership (RCEP) was in India’s interest, former NITI Aayog vice chairman Arvind Panagariya has said that if RCEP is signed by other 15 countries and “we are sitting outside” no multinational will want to come here.
“This is a great time for India to bring in large multinationals as investors to the country and if they have duty free access to the large Asian markets it will be an added kind of incentive for them to locate themselves in India. If RCEP is signed by other 15 countries and we are sitting outside, no multinational will want to come here”, Panagariya told The Indian Express in an interview.
The RCEP includes the 10 ASEAN countries along with China, India, Japan, South Korea, Australia and New Zealand. Negotiations began in 2012 and were originally expected to finish by the end of 2015. However, they have dragged on far longer than anticipated due to disagreements between between countries. Panagariya’s statement comes barely a week after India’s announcement not to join RCEP saying the agreement does not reflect its original intent and does not address India’s key concerns.
“Prime Minister (Narendra Modi) outlined many of these reasons as they were looking for a better bargain...some of the concessions they were seeking were not offered so they chose to stay outside. My own reading is that this is not the final word, more negotiations will happen”, said Panagariya who left the Niti Aayog in August 2017.
“I think it is in India’s interest and (I) would imagine Prime Minister (Narendra Modi) recognises that. But some of the concessions that India was asking for, had not yet come through. It is a very large market; you got 3 billion people; 20 percent of the global GDP is covered in that; so, you can’t be outside of it because that would mean that anything we export to those markets will be subject to very high tariff whereas the other 15 who are members already, they will be exporting their products freely to each other’s markets. That leaves our exporters at very big disadvantage”, he added.
“I believe in the Prime Minister...he wants to take country forward...He is a risk-taking person...we have seen him in a number of areas...Ultimately, Indian industry has to compete in global market. Otherwise, we are left isolated and Asia is a very large growing market...the centre of gravity of global economy...I hope the Prime Minister sees that.”