Is opting out of RCEP-deal a good move?

So far Modi’s BJP government has been fulfilling its voters’ aspirations on home front, foreign affairs front and to an extent on economic front (though not fully). It has still four and half years left to set track and boost the economy of the country.

On home front, the government pleased its core voters as well as the rest of India by the abrogation of Article-370 and also in bringing near normalcy to Kashmir. The BJP party could win both Maharashtra and Haryana elections, though the opposition tried projecting economic slump and unemployment as their sole issues to fight with. They dragged in, the recent Nobel prize winner in Economics, Abhijit V Banerjee to buttress their point of India being derailed by Demonetisation and hastened multilayer process of GDP. Yet, the voters reposed confidence in the prime minister’s abilities. The local factors did little matter to them.

Coming to foreign affairs, the prime minister is leaving no stone unturned. His biggest victory is in bringing Saudi Arabia, United Arab Emirates (both Organisation of Islamic Conference-OIC countries) whom Pakistan has previously kept on its hold on religious grounds, to Indian side to support on Kashmir issue. Of course, US and other developed nations are also on our side as they deemed the matter an internal one. In any case, India has to deal with Turkey, Malaysia and Iran that criticised India’s Kashmir policy. This stand of those countries is due to internal bickering of Islamic nations rather than India being hostile to them. Since India is close to Saudi and Emirates, they have taken another stance rather they not being against Kashmir policy.

Inviting European Parliament members delegation, though unofficial, was not a bad move. The Western media constantly baits India on Kashmir by mouthing and by writing columns on violation of civil liberties and Human Rights and all freedoms in an exaggerated way. Any Muslim-related issue, they view with a magnifying glass. The Muslims in the Valley have always been emboldened by the neighbouring Pakistan and this western media that protects them in their umbrella. Our liberal journalists also add fuel to fire by their writings in support of them. So, the European parliament members visit could benefit India’s point of view to a smaller/larger extent in the world fora. The member delegates may be from far right in their countries but they too have brains, a point of view and a place in their Parliament.

Internal cultural matters and external relationships with countries are convincingly addressed. But the prosperity of the country lies in economic robustness. The government knows there’s an economic slowdown but is uncertain of measures to adopt to boost it. ‘Make in India’ program has not taken off in the manner desired by the government.

The RCEP – Regional Comprehensive Economic Partnership deal – a free trade agreement among the countries in the ASEAN and China, Japan, South Korea, Australia and New Zealand- by not joining the deal, is India doing a good thing- is debatable. The prime minister said in Summit (on 03-11-2019) that the present form of the RCEP agreement does not address satisfactorily India’s outstanding issues and concerns. There is also a growing concern within India that the country may be flooded with cheap industrial products from China and agricultural products from Australia and New Zealand once it signs the deal. Even without the RCEP deal, India is, right now, flooded with Chinese products in Indian markets. India has WTO agreement that benefitted country to a large extent. So is the RCEP deal. If not now, after a year or two, if some of the concerns of India are addressed, it is better for India to join the RCEP. Except India, all the other 15 member countries were on board to sign the agreement. They all wanted India as a counter-weight to China by signing the deal.

In the Summit that held recently, in his address while opting out from the agreement, the prime minister said, “When I measure the RCEP agreement with respect to the interests of all Indians, I do not get a positive answer. Therefore, neither the Talisman of Gandhiji nor my own conscience permit me to join RCEP”. Here all the opposition parties in India are with prime minister. All are in unanimity.

Now let’s know see what Gandhiji’s Talisman is. Gandhiji, in those days, opposed use of machinery for producing things which we can produce without its aid. He repudiated industrialised countries for their exports. He said, “The village communities (in India) should be revived. Indian villages produced and supplied to the Indian towns and cities all their wants. India became impoverished when our cities became foreign markets and began to drain the villagers dry by dumping cheap and shoddy goods from foreign lands.” (CW 64:118) He also said, “If I can produce my things myself, I become my master”. Hence his stress was on self- reliance. They were all his protectionist theories way back. Now, the world has changed and India has moved on into a free trade era.

Though glad that Indian negotiators have not caved into pressures from the global powers into trade issues (even US President Donald Trump called PM Modi a tough trade negotiator), it’s better to go along with the other RCEP countries, if some of the sticky issues raised by India are resolved. India is a large beneficiary of liberalisation in 1990. At that time also there was a stiff opposition to that move. Still, even now, the same forces are opposing citing the same reasons.

As far as the Congress party is concerned, it always tried it’s best to keep the country backward, so that, in people’s ignorance, they could cash in on. But for the former PM PV Narasimha Rao’s initiative, economic liberalisation would not have been possible. Any other Congress prime minister, in his place, would not have gone on for liberalisation. Joining the RCEP is again an economic reform. The BJP is altogether a different party, so, it should act differently by not rejecting the RCEP completely. It has to have back channel talks for settlement in order to take the country forward. India cannot afford to live in isolation as is sought by Gandhiji way back.

Some political parties in the opposition and businessmen may applaud for not signing the deal. Businessmen have definitely their vested business interest. They know that they have to wind up, if they cannot compete. What about the poor consumer, why should he pay for their inefficiency? The commerce and industry minister Piyush Goyal’s assurance: India can talk if concerns are resolved, is encouraging for the benefit of Indian economy.

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