Arvind Panagariya, former NITI Aayog vice-chairman has said that the Regional Comprehensive Economic Partnership (RCEP) was in India’s favour, and if it is now signed by fifteen other countries while India sits outside, not one multinational company would want to come to India.
In an interview with The Indian Express, Arvind has highlighted the pros and cons of India’s decision on the RCEP. He said, “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”.
Arvind’s take on the RCEP situation is based on the recent development in its negotiations, a week after India decide to not join RCEP as it no longers reflects its initial intent and does not cater to Indis’s concerns. The negotiations had first started in 2012 and were expected to be done by 2015, however, the course of the negotiation has stretched way ahead of its decided timeline.
“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.
“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.”
