Australia’s High Commissioner, Harinder Sidhu says political will
to conclude the deal must be matched with persuading Indian
industry.
The 16-nation group led by ASEAN countries is reaching the homestretch for
talks on the Regional Comprehensive Economic Partnership (RCEP) Free
Trade Agreement, which, if it is signed will include half the world’s
population and a third of its GDP. Making a push for India, Australia’s High
Commissioner, Harinder Sidhu says political will to conclude the deal must
be matched with persuading Indian industry.
India and Australian PMs had set several deadlines for a free
trade agreement between the two countries, called CECA, since
2011, but we have seen no movement on it. Has CECA now been
shelved?
I wouldn’t say that. What we’ve seen is an evolution in the economic
relationship. CECA will always be an important element of our economic
relationship, but I think what we have started to do is broaden our
understanding.
It will always be useful for us to have a bilateral FTA, but the government in
Canberra has now endorsed an Indian Economic Strategy, and the Indian
government was so impressed by this document, it has commissioned a
partner study of how India can build its economic relationship with
Australia.
But the issues that stalled CECA negotiations still remain…
I think we always have some issues in a relationship, so it’s not unusual to
disagree. In fact, the facts show the economic relationship has not been
scuttled because of the differences. Agreements like CECA take time, and
come to a conclusion when the time is right. To turn to RCEP, the multilateral FTA that India and Australia are
part of. Australia just held the last round of negotiations…do you
think that substantial outcomes can be achieved in RCEP this
year, as planned?
From the last meeting in Melbourne, our sense is that we are reasonably
optimistic that a conclusion on RCEP is achievable by the end of the year.
The feedback from the Australian side and the Indian side was that the
meeting was constructive. I see Minister Goyal has been consulting with
industry members ahead of the ministerial RCEP meeting soon…There is a
clear sign of commitment to an RCEP outcome, and it is clear that this goes
all the way to the top in the Indian system, and I think that gives the RCEP
negotiation a great deal of weight not just for India but for all negotiators.
But after those industry consultations, the statements issued by
the Indian industry are very negative about RCEP. Are you
convinced the political hurdles will be crossed?
That’s for the Indian government to say. What I am hearing is political will
to conclude the RCEP agreement. It’s not just India that faces these industry
concerns, as all trade negotiations are. Trade negotiations are an effort to
balance the benefits of a trade deal with the concerns of industry. It cannot
be in one direction or the other. So the task at hand, which I am sure the
Indian government is doing is to explain that what RCEP will do for them is
to open the door to multiple markets in one fell swoop. It allows Indian
industry access to a number of countries in the region and is a pathway to
India’s economic development, which can only be good for industry.
Australia has taken a leadership position in working with India’s
concerns, which are not just about access to Chinese goods but
also about the lack of movement for Indian services. Groups
opposing RCEP have made the case that India has not benefitted
in the trade balance from any of the FTAs it has signed. How will
RCEP overcome that?
There are two issues here. A trade agreement doesn’t bring benefits unless
you used the agreement well. In a multilateral agreement, the benefits are
multiplied. Indian negotiators like any good negotiators can get the best deal
in their own country’s interests. But the second part is that industry has to
use the access that they gain from the agreement to extend their reach.
Could RCEP move ahead without India in November, if the
government is not able to resolve these concerns?
It is Australia’s view is that the great value of RCEP is that it includes the two
biggest economies of the region, India and China. We would be very
disappointed and we would actively argue against leaving any country, but
particularly India. If we want to get a truly integrated economy in the region,
having all the RCEP countries in the agreement is essential. We would not
advocate for excluding India, we would actively advocate to include India and
it is why I have put a lot of work into talking to the Indian government about
the importance of RCEP and encouraging government and industry here to
lean forward on the negotiations.
Source: The Hindu, India Monday, 29 July 2019