India shouldn’t use China as excuse for renewed RCEP rejection

By Lin Minwang Source: Global Times Published: 2020/7/11 8:46:56

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New Delhi reportedly "won't review" its decision not to join the Regional Comprehensive Economic Partnership (RCEP). Top official sources were quoted as saying New Delhi won't join any trade agreement where China is a member, especially after the COVID-19 pandemic and the border stand-off with China.

This gives rise to concerns that although Chinese and Indian border troops have been taking effective measures to disengage in the Galwan Valley region and other areas, India may continue its hostility against China in more multilateral diplomatic situations and that impacts will follow.

India's renewed rejection is likely in response to the joint statement from the 10th RCEP Inter-sessional Ministerial Meeting in June which re-emphasized that the RCEP remains open for India. However, by saying no to the RCEP once again, India has this time closed the door to RCEP negotiations. Citing China as an excuse is nothing but a demonstration of its complex sentiment toward China.

After Indian Prime Minister Narendra Modi announced his decision to pull out of the RCEP at an RCEP summit in early November, 2019, Indian media outlets started labeling the multilateral trade framework "Chinese-dominated" or "Chinese-backed." It must be pointed out that such labels are clearly wrong.

The RCEP is not "Chinese-dominated" or "Chinese-backed." In fact, the other 14 members are unlikely to allow China to dominate. RCEP negotiations and the promotion process have been centering on the Association of Southeast Asian Nations (ASEAN).

Indian officials said India would not review its decision not to join the RCEP, citing border tensions as an excuse. This is clearly a method of venting of irrational emotions after a recent deadly border conflict in the Galwan Valley. India's years of hesitation toward the RCEP are essentially due to the country's weak manufacturing sector.

It has seen rapidly increasing imports from RCEP countries in recent years, but has recorded barely increasing exports to those countries. Its trade deficits continue to expand, and will likely grow larger if it joins the framework. Thus India is seeking the best accession plan in the negotiations, and its requirements are clearly difficult for other countries to meet.

But there is already a fierce debate in India about the Modi government's withdrawal from the RCEP. Many argue that distancing itself from the RCEP will inevitably cost India its opportunity to integrate with Asia-Pacific economic entities, and will subsequently block its long-term economic development.

What Indian leadership needs now is more political courage and determination, to be able to see long-term interests and to pay the short-term political cost in exchange for the future manufacturing development of the South Asian country.

Taking into account the size of India's economy, India now needs to integrate into a larger economic circle rather than isolate itself. As the global free trade system is facing challenges amid increasing geopolitical competition, the RCEP provides huge economic space for the future economic development of the countries in this region. Given India's economic development stage, the multilateral platforms would also be beneficial choices.

After the deadly border conflict in June, India's diplomacy has entered an irrational state of anger. It is expanding its emotional approach to many other aspects of relations. Using border tensions with China as an excuse for its latest RCEP rejection is just another example. If India continues this irrational approach, it would not only harm regional interests, but would not benefit India's own long-term interests. China is not India's enemy, and China will not become India's enemy. India's real enemy is itself.

As a large growing economy, India should thoroughly assess its status in Asia as well as in the world, and its long-term national interests. When facing a more powerful neighbor, it is critical for India to properly assess its situation and rationally reduce its rivalry toward China to develop favorable economic and diplomatic strategies, rather than irrationally heating up nationalism and blaming China when it encounters unsatisfactory situations.

The author is a research fellow at Fudan University's Center for South Asian Studies. 


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