India’s trade deficit with 11 economic partners likely to muffle its voice at RCEP negotiations

Experts are cautious about the Regional Comprehensive Economic Partnership (RCEP) negotiation, as India has reported a trade deficit with as many as 11 RCEP member countries in the 2018-19 fiscal. 

Published: 20th May 2019 05:58 AM  |   Last Updated: 20th May 2019 08:21 AM   |  A+A-

Representational image.

By Express News Service

Experts are cautious about the Regional Comprehensive Economic Partnership (RCEP) negotiation, as India has reported a trade deficit with as many as 11 RCEP member countries in the 2018-19 fiscal. 
The RCEP is a proposed Free Trade Agreement (FTA) between 10 member states of the Association of South-East Asian Nations (ASEAN) and the six Asia-Pacific states with which ASEAN has existing free trade agreements.

The RCEP bloc comprises 10 ASEAN group members, namely Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam; and their six FTA partners — India, China, Japan, South Korea, Australia and New Zealand.
According to the provisional trade data, India’s trade deficit with three countries — Brunei, Japan and Malaysia — has in fact increased marginally in FY 2018-19 as compared to the previous fiscal. Trade deficit is the difference between imports and exports. 
Also, the trade surplus with Singapore ($2.7 billion) in FY18 has turned into deficit of $5.3 billion in FY19. India has trade surplus with Cambodia ($0.1 billion), Myanmar ($0.7 billion), and the Philippines ($1 billion) in FY19; it did not carry out any trade with Laos last year.
Senior officials of the RCEP group, who are negotiating a mega free trade agreement, will hold meetings in Bangkok from May 24 to iron out issues pertaining to the goods and services sector. Experts have mixed views over the impact of the increasing trade gap on India’s position during the negotiations for the mega FTA.

While India is likely to get greater market access in other countries not only in goods but also in services, many experts have cautioned that the pact would impact domestic manufacturers. “Free trade pacts are not about only giving market access, but also getting that access in other countries. Our exports to countries like Singapore, with which India has trade surplus, is not increasing. In FY 2018-19, we have a trade deficit with Singapore,” said Biswajit Dhar, Economics professor at JNU.
Member countries are looking to conclude the talks this year, but many issues, including the number of products over which duties will be eliminated, are yet to be finalised. 

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp