It is official. The commerce and industries minister Piyush Goyal will not take part in the Regional Comprehensive Economic Partnership (RCEP) Intersessional Ministerial meet. The minister was scheduled to attend the meet on August 2-3 in Beijing. The RCEP is a mega trade agreement negotiated among 10-member ASEAN countries and six foreign trade agreement (FTA) partners - India, China, South Korea, Japan, Australia, New Zealand. These countries are home to 45 per cent of the world population. They contribute 25 per cent to global gross domestic product and generate 30 per cent of cross-country trade. They also attract 26 per cent of foreign direct investments.
The 27th round of negotiations being held at Zhengzhou in China will be followed by the trade ministers' conclave.
Meanwhile, the minister cancelled his tour after the government extended the ongoing Parliament session till August 7, government officials told BT.
Goyal is also the deputy leader of the Bharatiya Janta Party in Rajya Sabha.
However, there is more than what meets the eyes. India is in no mood to conclude the negotiations. At least not in the present form. The member countries are creating pressure to conclude negotiations, and they blame that India is becoming a stumbling block. Earlier, the deadline was December 2018, but was extended till end of this year, since many member countries went in for general elections.
Goyal is under immense pressure from the local industry to not budge under pressure on cheaper imports from these countries. The absence of Goyal means India is budging. The 19 other countries are pushing India to forgo concerns on tariff elimination. The pact would mean more dumping of products.
In the last fortnight, Goyal met with representatives of various export promotion councils in Delhi and Mumbai. There is a major resistance from the steel, auto, textiles, and engineering goods manufacturers along with farmers and dairy producers.
Most member countries are determined to sign the agreement by the end of 2019. India is not keen to oblige. Many manufactures argue India has free trade agreements with ASEAN, Japan and South Korea and is negotiating a deal with Australia and New Zealand. The RCEP will only give more access to Chinese products, with almost zero resistance. Goyal might have bought time to think more by skipping the ministerial. At the end of the day, he may take a balanced view.