India is firm on the decision to not become a member of the RCEP (Regional Comprehensive Economic Partnership). The Modi government is reportedly “not reviewing” its decision on RCEP due to the presence of China as a member.
According to the sources, India has decided it won’t join any trade agreement including RCEP where China is a member as matters have turned worse for India, especially after the border stand-off with China.
Last year, India backed out of the RCEP agreement citing its negative effects on “farmers, MSMEs and dairy sector”. “The present form of the RCEP Agreement does not fully reflect the basic spirit and the agreed guiding principles of RCEP.
It also does not address satisfactorily India’s outstanding issues and concerns. In such a situation, it is not possible for India to join the RCEP Agreement,” PM Modi had stated at RCEP summit in Bangkok. The summit included China, Japan, Australia, New Zealand, South Korea, and the 10-nation ASEAN grouping.
“There is no question to join the pact now that the prime minister has given a clarion call to a self-reliant or ‘atmanirbhar’ (self-reliant) India,” said an official who refused to be identified. The comments came after Thailand said all member countries have decided to sign the trade pact by the end of 2020 without India, and the deal may come into force by the middle of next year.
According to Chinese state mouthpiece, Global Times (GT), this is a method of venting of irrational emotions after a recent deadly border conflict in the Galwan Valley.
“India’s years of hesitation toward the RCEP are essentially due to the country’s weak manufacturing sector,” it said. “After the deadly border conflict in June, India’s diplomacy has entered an irrational state of anger.
It is expanding its emotional approach to many other aspects of relations. Using border tensions with China as an excuse for its latest RCEP rejection is just another example. If India continues this irrational approach, it would not only harm regional interests but would not benefit India’s own long-term interests,” it added.
It further criticised the Indian media for calling RCEP as “Chinese-dominated” and “Chinese-backed” trade deal.
Despite China’s belligerence, no other country has shown any hesitation for signing the RCEP agreement. “For countries such as Australia, South Korea, Japan and New Zealand it will be difficult to have inner coherence between geopolitics and trade,” said Rajiv Bhatia, a veteran diplomat.
Vietnam, which is now the ASEAN chair has said that it will continue to urge India to join the RCEP “whenever it feels comfortable”.
Amid soaring tensions in the South China Sea when the Chinese ship attacked and sank a Vietnamese boat near the Paracel Islands, it is still going to go ahead with the RCEP deal. Similarly, Australia, which has blamed China for the origins of Covid-19 and its growing military aggression, also seems clear about joining the RCEP.
China’s advice to India is that while facing a “more powerful neighbour”, it is imperative for India to properly assess its situation and rationally reduce its rivalry toward China to develop favourable economic and diplomatic strategies, rather than “irrationally heating up nationalism and blaming China when it encounters unsatisfactory situations”.