The deal had earlier been held up due to disagreement over eliminating tariffs on goods trade, a subject on which India has come under increasing opposition from the other nations. Now, led by Asean, these countries want that tariffs on almost 92 per cent of all traded goods be reduced or eliminated.
“I hope India will not disappoint Asean this year in completing the RCEP,” Indonesian trade minister Enggartiasto Lukita told captains of industry from India and Asean.
Asean has pushed for meaningful progress on RCEP before the end of this year — 2018 is the 50th anniversary of its founding. However, India has continued to push back. "So many things are happening. Where is the question of disappointment?” commerce and industry minister Suresh Prabhu said on the repeated negotiations.
Services trade has become the latest big issue in disagreements; India wants liberalisation of rules here and greater market access. This country has large numbers of trained services professionals such as nurses, chartered accountants, information technology professionals and trained workers in several other segments.
“The rise of the services sector is defining India's growth narrative; this is a common strand between India and Asean,” commerce secretary Rita Teaotia said in the inaugural speech at the event, hosted by business chamber CII.
India had pushed hard for the opening of services trade, especially on Mode 4, on cross-border migration of professionals in the sector. While other nations have historically not been open to the idea, they have started to make discussion on e-commerce a part of those on services, said the official mentioned earlier.
India should be wary of e-commerce norms being imposed on it, owing to the digital platform still in a nascent stage in the country. Within e-commerce, issues such as consumer protection, domestic regulatory frameworks, customs duties and data protection, said Biswajit Dhar, trade expert.
Society groups have voiced concern over possibly drastic reductions in agricultural tariffs, making Indian products uncompetitive, as well as looser investment norms, exposing the country to litigation from foreign commercial interests.
RCEP is expected to be the world's largest regional trading bloc, with nearly 45 per cent of global population and combined gross domestic product of $21.3 trillion.
India's trade with Asean nations was a little more than $70 billion in 2016-17. The bloc is source and destination of more than a tenth of our import and export.