Indian Economy News & Discussion - Nov 27 2017

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Kaivalya » 02 Nov 2019 19:16

Rajeev Srinivasan on indian economic Nobel laureates and their work incisive as always

https://m.rediff.com/business/column/abhishek-banerjee-and-the-mystique-of-the-nobel-prize/20191101.htm

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby sanjaykumar » 03 Nov 2019 00:02

The problem with RCT is not controlling for known variables. It is assuring randomisation.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby jpremnath » 03 Nov 2019 02:46

Sachin wrote:Is India ready for RCEP embrace?
Can any one through some light on the RCEP agreement, and if it is brings good to India in the long term? The commie/socialist gang have already started a social media campaign, but I don't want them to reject them outright.


Not an expert...but from whatever i read on this, nothing good is going to happen for India from joining RCEP. For any FTA, there has to be give and take..But ASEAN, Cheen, Aus & Kiwis expect India to just open up for their products while not granting anything for us. There is just some soundbites about working on services in the future, but as of now, they dont want to open up their services industry to our manpower or companies. When we agreed to an FTA with ASEAN 10 years back, they promised the same thing, but in the end, our trade deficit with them has ballooned. They have till date not given any concessions to India on services which they promised. Since our govt and babudom is the epitome of efficiency, nothing has been done to get it right either..

We need to understand that the ASEAN and Cheen economies are nothing but well oiled export machines. Our diary and plantation industry will be decimated by Vietnam and ANZ. We just cannot compete with them. Our infrastructure, both logistics and power are expensive and makes our industries less competitive. Add to that the cost if land and labour. We can see that many Indian companies have started manufacturing in ASEAN countries like Thailand and import to India.

We can hate the commies, but this time its not just them who is clamoring against RCEP. I couldnt find a single point on how this is going to benefit us. All what we can hear is that "this is the worlds biggest trading block and India has to be part of this yada yada...". The only negative I see in opting out of RCEP is that these countries can pile on NTBs and additional tariffs which we cant question anywhere. All i can say is let it be...we need to invest in our hard and soft infra and help our industries become competitive before joining anymore lopsided FTAs...

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Yagnasri » 03 Nov 2019 12:29

I am also not an expert but to have any sort of free trade thing with China is not going to help us at all. When did anyone benefit from having such arrangements with them?

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 03 Nov 2019 21:09

After a long hard thinking I feel this may not be a good time to sign the RCEP agreement. The reason ASEAN, China and other countries want India to sign are different. Chinese access to US markets has been severely curtailed. It is looking for another big market for its products. ASEAN is an export-led economic system and they have stagnated and are looking for a big market to further their growth. Similarly NZ, Aus are looking for a big market for their agri produce. The govt has just right now reduced corporate tax and it will take at least 5-10 years for Indian companies to become globally competitive. Besides there has been very little reform in land and labor. Our agri produce is non-negotiable as 50% of the population still depend on it. India is not an export-driven economy. While there is a case for increasing exports this is not the right time as Indian companies are not yet ready. Most are still doing screw drivergiri or simply stamping imported products with company logo. At this time India has no competitive advantage in either manufacturing or agri where it can sell a lot of products. While the partner countries are already giants in these sectors. We are only competitive in services which can be pursued without signing RCEP. So I don't see much net benefit to the Indian economy at this stage. As such we should not sign the RCEP and instead wait for another 5-10 years to become competitive. This IMO.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby kit » 03 Nov 2019 21:26

jpremnath wrote:
Sachin wrote:Is India ready for RCEP embrace?
Can any one through some light on the RCEP agreement, and if it is brings good to India in the long term? The commie/socialist gang have already started a social media campaign, but I don't want them to reject them outright.


Not an expert...but from whatever i read on this, nothing good is going to happen for India from joining RCEP. For any FTA, there has to be give and take..But ASEAN, Cheen, Aus & Kiwis expect India to just open up for their products while not granting anything for us. There is just some soundbites about working on services in the future, but as of now, they dont want to open up their services industry to our manpower or companies. When we agreed to an FTA with ASEAN 10 years back, they promised the same thing, but in the end, our trade deficit with them has ballooned. They have till date not given any concessions to India on services which they promised. Since our govt and babudom is the epitome of efficiency, nothing has been done to get it right either..

We need to understand that the ASEAN and Cheen economies are nothing but well oiled export machines. Our diary and plantation industry will be decimated by Vietnam and ANZ. We just cannot compete with them. Our infrastructure, both logistics and power are expensive and makes our industries less competitive. Add to that the cost if land and labour. We can see that many Indian companies have started manufacturing in ASEAN countries like Thailand and import to India.

We can hate the commies, but this time its not just them who is clamoring against RCEP. I couldnt find a single point on how this is going to benefit us. All what we can hear is that "this is the worlds biggest trading block and India has to be part of this yada yada...". The only negative I see in opting out of RCEP is that these countries can pile on NTBs and additional tariffs which we cant question anywhere. All i can say is let it be...we need to invest in our hard and soft infra and help our industries become competitive before joining anymore lopsided FTAs...



most of the nitty gritties seem to have been discussed with quite a few for consultation. For the time being the feeling is to be in the RCEP is better than without. How things can pan out will depend on how other economies open up., if the babus do their job there may not be too many things to worry about, but as with all trade deals there is an element of uncertainity., even then thing will not be out of hand. Point to remember account surplus and completely balanced trade is not what is being aimed for., but getting the economy performing bigger to near 5T is. So it is quite likely trade is going to be skewed in the negative side for a while., hopefully competitiveness will pick up with measured interventions.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 03 Nov 2019 21:43

The question is what are we going to sell to the partner countries. We are not even able to sell Indian made mobile phones to Indians themselves. Signing RCEP at this stage is pre-mature. It is like trying to sell LCA to America.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby jpremnath » 03 Nov 2019 21:44

kit wrote:
most of the nitty gritties seem to have been discussed with quite a few for consultation. For the time being the feeling is to be in the RCEP is better than without. How things can pan out will depend on how other economies open up., if the babus do their job there may not be too many things to worry about, but as with all trade deals there is an element of uncertainity., even then thing will not be out of hand. Point to remember account surplus and completely balanced trade is not what is being aimed for., but getting the economy performing bigger to near 5T is. So it is quite likely trade is going to be skewed in the negative side for a while., hopefully competitiveness will pick up with measured interventions.


That seems like signing on with only hopes and no substance...and trusting our babus to take care of our interests?..really? Did that even workout when we signed the FTAs with Thailand, ASEAN and SriLanka.?... We cant go by the 'feeling' that being inside is better than being outside. I mean in what way?..Which industry is going to benefit? You can clearly see that even the other members of RCEP is not clearly articulating what is in there for India.

Maybe you can throw down our plantation industry and its farmers under the bus so that the tire and spices industry gets cheap ingredients from ASEAN. But then the Chinese and Korean tires will destroy our tire industry within years...Our automobile accessories business will shrink with cheaper imports from Thailand and China. Or you think consumers will benefit with cheaper items ?...Our consumer economy is small and the vast majority of the population still depends on the areas which are going to be affected by cheaper imports. Without improving the living conditions and earning power of the lower strata, we are never going to reach that magical figure of 5 trillion GDP.

None of our FTAs have served us well..because in a distorted world trade, free trade is not fair trade. It doesnt make sense that economies at different levels of sophistication can engage in free trade expecting that both will benefit..Our agriculture is inefficient..so is our industry..but the reasons are not that they are lazy. They just dont enjoy the same benefits enjoyed by these major economies. This should be clear to anyone, but I can see only some in the govt are skeptical. We need to just tell those folks in RCEP that, "Gentlemen, we are sorry to have wasted your time, but we think it is not the right time for us to join. We hope to join the bloc at an opportune time. Good luck to you guys"....

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 03 Nov 2019 21:47

Except India all other countries are negotiating from a position of strength as they already have a robust base for their products. India at this stage is only competitive in services and the big markets are China and to a lesser extent Japan and Aus, NZ. We can negotiate on services with them without getting into RCEP.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 03 Nov 2019 21:51

FTAs have not greatly worked because we are not competitive in most manufacturing and even agri. The reasons are several. Cost of money, high corporate tax, land, labor and lack of innovation. Except corporate tax and to a lesser extent cost of money the other issues are still pending. If we sign the RCEP now we are likely to be steamrolled by partner countries. It is like trying to fly without wings.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Katare » 03 Nov 2019 22:03

It’s scary for sure but it could also force us to reform faster and get our A game on sooner.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby jpremnath » 03 Nov 2019 22:10

Katare wrote:It’s scary for sure but it could also force us to reform faster and get our A game on sooner.


We didn't reform for the ten years since ASEAN FTA...We won't change enough in the next 5 either... Labour and land reforms are practically impossible to bring about in India in a short time, even for this govt ..These two itself will take ages to get everyone on board...
No country is ready to open up their economy for services, which is our only competitive industry. The reasons are political i guess...They don't want to see an influx of Indians in their country..So until these guys agree to open up Visa rules and services, we shouldn't sign up

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 03 Nov 2019 22:16

I won't be that pessimistic. Land was an IED planted by the NAC. We have to slowly get out of it. Labor is ongoing. Labor laws have been simplified. My guess is that PSU strength is first going to be reduced to prevent political unions from getting in and then further liberalized. It will take 5-10 years depending on political majority.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby jpremnath » 03 Nov 2019 22:53

Supratik wrote:I won't be that pessimistic. Land was an IED planted by the NAC. We have to slowly get out of it. Labor is ongoing. Labor laws have been simplified. My guess is that PSU strength is first going to be reduced to prevent political unions from getting in and then further liberalized. It will take 5-10 years depending on political majority.


5-10 years is a long run...we had 10 years of ASEAN FTA and it has already destroyed so much of our domestic capabilities. Imagine joining one with China and Korea..whatever nascent manufacturing we gathered will be decimated. It is not like our big companies will die off..they will just move their production to ASEAN or China. I remember how when i was practicing in India, the Godrej guy came to our office and showed nice Door hardware products and proudly claiming that they were all imported from their own factories in China..it hit my gut. There is already so much of agriproducts manufacturing happening in Thailand and Malaysia by Indian brands..Its just gonna go on a hyperdrive.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Katare » 03 Nov 2019 22:53

jpremnath wrote:
Katare wrote:It’s scary for sure but it could also force us to reform faster and get our A game on sooner.


We didn't reform for the ten years since ASEAN FTA...We won't change enough in the next 5 either... Labour and land reforms are practically impossible to bring about in India in a short time, even for this govt ..These two itself will take ages to get everyone on board...
No country is ready to open up their economy for services, which is our only competitive industry. The reasons are political i guess...They don't want to see an influx of Indians in their country..So until these guys agree to open up Visa rules and services, we shouldn't sign up


I see what you are saying and I would agree with the logic if waiting for longer is some how going to make us more competitive. The rest of the world would integrate, create massive scales and get more efficient than us at a faster rate.

In five years when we come back to table would it be more or less challenging to negotiate? We are in such a bad shape because we didn’t open up and integrate earlier or faster.

Also trade deficits, although nasty have inbuilt readjustment by way of currency devaluations that helps deficit country’s export and makes imports from surplus country more expensive. It is a painful process but no pains no gains holds everywhere.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Rahulsidhu » 03 Nov 2019 23:10

jpremnath wrote:
Supratik wrote:I won't be that pessimistic. Land was an IED planted by the NAC. We have to slowly get out of it. Labor is ongoing. Labor laws have been simplified. My guess is that PSU strength is first going to be reduced to prevent political unions from getting in and then further liberalized. It will take 5-10 years depending on political majority.


5-10 years is a long run...we had 10 years of ASEAN FTA and it has already destroyed so much of our domestic capabilities. Imagine joining one with China and Korea..whatever nascent manufacturing we gathered will be decimated. It is not like our big companies will die off..they will just move their production to ASEAN or China. I remember how when i was practicing in India, the Godrej guy came to our office and showed nice Door hardware products and proudly claiming that they were all imported from their own factories in China..it hit my gut. There is already so much of agriproducts manufacturing happening in Thailand and Malaysia by Indian brands..Its just gonna go on a hyperdrive.


+1. We should be doing FTAs with the US and UK rather than ASEAN, China, Korea or Germany.
RCEP looks to me like a bunch of hungry sharks looking for a nice juicy prey :lol:

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 03 Nov 2019 23:16

ASEAN and other FTAs did not happen because you were asking Hima Das to be world champion after tying her left and right shoe laces together. Ofcourse it would not happen because you need to first carry out domestic liberalization and make your companies competitive. None of this happened in the last 10-15 years - even during Modi 1.0. It does not mean it cannot happen in future. Just that we are not at that stage. So first step should be domestic liberalization. Corporate tax cut is the first step.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby jpremnath » 03 Nov 2019 23:54

Definitely...But we should join RCEP only after we get the basics right...Let the govt do the reforms at its pace, the RCEP can wait..By joining it without a level playing field, we will be slaughtered..

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 04 Nov 2019 00:02

yes

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Kaivalya » 04 Nov 2019 09:38

It looks like the differences are *not* minor in terms of the RCEP :

Differences between India and some others like China still persisted on certain crucial aspects — especially in safeguard mechanism, tariffs, rules of origin and services trade — even after hard negotiations over the weekend, a source aware of the talks told FE.


It appears like china is pushing through the trade agreement as a replacement of TPP and increase tariff pressure on india in the near future by holding the other 15 nations in position. Strange that japanese negotiators ( one resigned last week and current went back to japan offering a polite excuse) are not there in the summit.

Given the fact that negotiations started 2012 (UPA II) - it is not clear how much room there is to maneuver. Conditional support with enough ramp time (for ex : 2025 or 2030 ) and ramp products with a rigorous verification process might be what PGji is hinting at...or maybe I am reading too much in between the lines. Keeping my fingers crossed and looking for more information...


https://www.financialexpress.com/economy/rcep-india-may-offer-conditional-support/1753459/

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby yensoy » 04 Nov 2019 10:07

1. What does RCEP get us which is already not covered under WTO?
2. ASEAN FTAs were negotiated earlier, rather handed over like candy, has this benefited us in any way besides slightly cheaper shampoo and soap from Thailand?
3. What safeguards can we expect countries, especially ASEAN, to take against using them as a pass-through for Chinese products?
4. Will China ever keep its end of a multilateral deal? Have they stopped pilfering technology as outlawed by IP laws, or allowing free market access as granted by the WTO, or abided by the UNCLOS decision on its dispute with Philippines?
5. We speak about export of services - however what is our plan when low-end services are replaced by automation? Higher end service folks don't repatriate money - they settle overseas; it's the low end that contributes the bulk of forex.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Kaivalya » 04 Nov 2019 10:23

yensoy wrote:1. What does RCEP get us which is already not covered under WTO?

By creating a trade block China will have leverage over us...is the only reason I can glean.

2. ASEAN FTAs were negotiated earlier, rather handed over like candy, has this benefited us in any way besides slightly cheaper shampoo and soap from Thailand?

Most of the countries are net export and/or too small for any benefits to us in terms of trade.

3. What safeguards can we expect countries, especially ASEAN, to take against using them as a pass-through for Chinese products?

That seems to be one of the sticking points as none exists. See earlier references

4. Will China ever keep its end of a multilateral deal? Have they stopped pilfering technology as outlawed by IP laws, or allowing free market access as granted by the WTO, or abided by the UNCLOS decision on its dispute with Philippines?

History has clear indications...

5. We speak about export of services - however what is our plan when low-end services are replaced by automation? Higher end service folks don't repatriate money - they settle overseas; it's the low end that contributes the bulk of forex.

I think even a standard services agreement has not been hammered out let alone services classifiers

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby nandakumar » 04 Nov 2019 11:11

Here is a thought on free trade agreements. It rests on the following assumptions.
1. Differences in competitive capabilities are bound to exist among countries.
2. This would be so no matter how much of domestic reform that nations undertake to shore up domestic competitiveness.
3. Free trade in services (of the non-tradeable kind) which is an euphemism for free movement of labour of the kind that prevails in the EU is unlikely to be acceptable to partners in a trade bloc.
4. Common legal code for enforcement of contracts and prosecution of individuals for civil infractions would be equally unacceptable for countries in the trade bloc. Can you imagine India agreeing to prosecution of a plumber citizen under Malaysian blasphemy law?
Given these assumptions trade among member countries in a trade bloc is inherently unsustainable for many while profitable for the rest. So my proposition is this. As part of the agreement for zero tariff trade, exporting country agrees to invoice goods in the currency of the importing country. This inherently commits the exporting country to source goods/services from the importing country at some future date. Such an arrangement worked very well for India during an earlier sanctions regime under which Iran operated. The proceeds of the oil trade with India were credited in a rupee account in India. It chose UCO Bank which did not run the risk of sanctions on its US operations by the USA, because it didn't have any! The money was used by Iran to buy pharmaceuticals and rice. Iran also earned some interest income on its oil related trade surpluses. Eventually the imbalance self corrected itself. This an be replicated across a broader group of nations forming a zero tariff trade regime.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Kaivalya » 04 Nov 2019 18:48

nandakumar wrote:Here is a thought on free trade agreements. It rests on the following assumptions.
1. Differences in competitive capabilities are bound to exist among countries.
2. This would be so no matter how much of domestic reform that nations undertake to shore up domestic competitiveness.
3. Free trade in services (of the non-tradeable kind) which is an euphemism for free movement of labour of the kind that prevails in the EU is unlikely to be acceptable to partners in a trade bloc.
4. Common legal code for enforcement of contracts and prosecution of individuals for civil infractions would be equally unacceptable for countries in the trade bloc. Can you imagine India agreeing to prosecution of a plumber citizen under Malaysian blasphemy law?
Given these assumptions trade among member countries in a trade bloc is inherently unsustainable for many while profitable for the rest. So my proposition is this. As part of the agreement for zero tariff trade, exporting country agrees to invoice goods in the currency of the importing country. This inherently commits the exporting country to source goods/services from the importing country at some future date. Such an arrangement worked very well for India during an earlier sanctions regime under which Iran operated. The proceeds of the oil trade with India were credited in a rupee account in India. It chose UCO Bank which did not run the risk of sanctions on its US operations by the USA, because it didn't have any! The money was used by Iran to buy pharmaceuticals and rice. Iran also earned some interest income on its oil related trade surpluses. Eventually the imbalance self corrected itself. This an be replicated across a broader group of nations forming a zero tariff trade regime.



In terms of making trade easier, there has been progress :

https://www.rt.com/business/472016-russia-india-china-swift/

We don't have to rely on barter system anymore as long as one has a tradeable currency. I.e Being able to trade without the need for a Uco bank. While this makes it easier, BRICs or assuming other countries using the SWIFT alternative will have to find stuff to trade and/or manage currency risk across a basket of currencies

Trade does not have to be tied to blasphemy law or human rights violations, EU style integration etc as they were all used by trading powers to project influence.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby arshyam » 04 Nov 2019 19:23

It's over, thankfully:

PM Modi: India Has Decided Not To Join Regional Comprehensive Economic Partnership(RCEP) - Swarajya

India today decided against joining the 16-nation RCEP trade deal, saying it was not shying away from opening up to global competition across sectors but had made a strong case for an outcome which is favourable to all countries and all sectors.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Supratik » 04 Nov 2019 19:24

India has declined to sign the RCEP. Thank God.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby arshyam » 04 Nov 2019 19:26

Some tweets quoted by the article:

Prasar Bharati News Services✔ @PBNS_India
India has decided not to join Regional Comprehensive Economic Partnership(RCEP) agreement as PM @narendramodi takes a firm stand on India's core concerns and in the interest of Indian farmers, MSMEs and dairy sector.#RCEP


Prasar Bharati News Services ✔ @PBNS_India
PM @narendramodi took firm stand on issues of tariff differential, trade deficit and import surges. There was no assurance for India on market access and non-tarriff barriers.#RCEP


Prasar Bharati News Services ✔ @PBNS_India
PM @narendramodi at #RCEPSummit: Present form of the RCEP Agreement does not fully reflect the basic spirit and agreed guiding principles of RCEP. It does not address satisfactorily India's outstanding issues and concerns...it is not possible for India to join the #RCEP Agreement


Prasar Bharati News Services ✔ @PBNS_India
Our farmers, traders, professionals & industries have stakes in such decisions. Equally important are the workers and consumers, who make India a huge market & third biggest economy in terms of purchasing power parity. #RCEPSummit


Prasar Bharati News Services ✔ @PBNS_India
When I measure the #RCEP Agreement with respect to 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: PM @narendramodi .

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby arshyam » 04 Nov 2019 19:30

India decides not to join RCEP: Decoding the reasons behind its decision - Money Control

The Indian government on November 4 announced that it has decided not to join the Regional Comprehensive Economic Cooperation (RCEP) as as negotiations failed to address New Delhi's concerns.

India's concerns included inadequate protection against import surge and fear of Chinese goods flooding the market.

What is RCEP?

The Regional Comprehensive Economic Partnership (RCEP) is a proposed free-trade agreement (FTA) among 16 countries.

The countries in RCEP include the 10 ASEAN countries — Indonesia, Thailand, Singapore, Malaysia, the Philippines, Vietnam, Myanmar, Brunei, Cambodia, Laos —and their largest trading partners—Australia, China, India, Japan, New Zealand and Korea.

What is the deal's significance?

The deal, once implemented, will create the world's largest trading bloc. These 16 countries account for about half of the world’s population, 25 percent of global GDP, nearly a third (30 percent) of global trade and the 26 percent of world foreidng direct investment flows (FDI). These

Negotiations for this agreement, which will entail substantial lowering of import tariffs for movement of goods and services across the member nations, have been ongoing since 2012.

India's worries

The RCEP could force India to cut duties on about 90 percent of the goods that are currently imported to India over the next 15 years. This has raised concerns that India will be flooded with cheaper imported goods, particularly from China and dairy products from Australia and New Zealand.

In his opening remarks at the ASEAN-India summit on November 3, Indian Prime Minister Narendra Modi did not mention the ongoing RCEP negotiations. Instead, he spoke about the ASEAN-India partnership and the decision to review his country’s trade agreement with the bloc. “This will not only make our economic relations more stronger, but our trade will also be balanced,” Modi said.

There have been concerns that India will be flooded with cheaper imported goods, such as steel from China and dairy products from Australia and New Zealand.

India registered a trade deficit in 2018-19 with as many as 11 RCEP member countries.

The industry reservations aren’t unfounded, given India’s huge trade deficit with China. China is India’s largest trading partner while we are China's 11th largest trading partner. India had a trade deficit of $104 billion with RCEP countries. More than half of this was with China at $53 billion. This has raised worries about India being flooded with Chinese goods once the RCEP deal takes effect.

What were the key issues concerning tariffs?

One of the key issues concerns the base year. India is opposed to the proposal that 2013 be treated as the base year for reducing tariffs, effectively implying that member countries should slash import duties on products to the level that existed in 2013. India is pushing for 2019 as the base year, given that import duties on many products such as textiles and the electronic products have gone up in the last six years.

What were the other key thorny issues on reduction of tariffs?

India want an auto-trigger mechanism to be institutionalised in the pact. This would serve as a kind of protective mechanism that a member country can invoke to safeguard in case of a unexpected flow of imports after RCEP comes into effect.

Besides, there are issues around ratchet obligations. India wants exemptions built into the ratchet obligations as part of the pact. A ratchet obligations implies that a member country cannot raising tariffs once the pact comes into effect. An exemption would imply that a country will be able to erect restrictive measures later on grounds of protecting national interest.

There is also the issue of data localisation under RCEP deal. India wants all countries to have the rights to protect data. This would imply that countries can share data only where it is “necessary to achieve a legitimate public policy objective” or “necessary in the country's opinion, for the protection of its essential security interests or national interests”.


Fully applaud this decision by the Modi govt. Maybe a decade later, we can see how things are and evaluate. Our market is too big to worry about being left out.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Rsatchi » 04 Nov 2019 21:24

https://timesofindia.indiatimes.com/bus ... 898544.cms
How is tht the RCEP driven by Chinese has Anzac, Banzai and Korean commitment.
Anzac probably want to sell all the raw materials/diary products understandable but why the rest. will not the Koreans and Japs find it find hard competing with Chinese goods (as the Chinese are catching up with high end manufacturing).
Or were the Japs and Koreans hoping to 'guboing' India along with the Chinese through this deal!!!

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby kit » 04 Nov 2019 21:27

Kaivalya wrote:It looks like the differences are *not* minor in terms of the RCEP :

Differences between India and some others like China still persisted on certain crucial aspects — especially in safeguard mechanism, tariffs, rules of origin and services trade — even after hard negotiations over the weekend, a source aware of the talks told FE.


It appears like china is pushing through the trade agreement as a replacement of TPP and increase tariff pressure on india in the near future by holding the other 15 nations in position. Strange that japanese negotiators ( one resigned last week and current went back to japan offering a polite excuse) are not there in the summit.

Given the fact that negotiations started 2012 (UPA II) - it is not clear how much room there is to maneuver. Conditional support with enough ramp time (for ex : 2025 or 2030 ) and ramp products with a rigorous verification process might be what PGji is hinting at...or maybe I am reading too much in between the lines. Keeping my fingers crossed and looking for more information...


https://www.financialexpress.com/economy/rcep-india-may-offer-conditional-support/1753459/



More like China pushing the(ir) whole deal/agenda through other SE nations. Quite blatant.

Well, they got their reply too.

There IS a price to access the vast Indian market of more than a billion and growing. Without reciprocal economic access, this will not work

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby chetak » 04 Nov 2019 21:46

some countries are merely putting a tempered glass cover on the chinese made cell phone display and are re exporting the fully chinese made cell phone to India as a "value added" product "originating" from their countries thus incurring zero duty.

This is merely one example.

This is how the hans are screwing with us.


India will not join Asian trade deal RCEP: Narendra Modi says agreement doesn't reflect original intent, can't compromise on core interests

Nov 04, 2019

India has decided not to join the Regional Comprehensive Economic Partnership (RCEP) agreement as its key concerns have not been addressed

Prime Minister Narendra Modi, attending the ASEAN summit in Bangkok, stood firm on India's concerns in the trade deal not being addressed and decided there cannot be any compromise on core interests

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Kaivalya » 04 Nov 2019 22:06

Background data on the historical negotiations that seems to have made no progress from an indian perspective :

https://tejas.iimb.ac.in/articles/RCEP_Implications_for_Indian_Trade_&_Economy_Tejas_Dec_2017.pdf

Summary :

Services was the only upside with 7 service categories assigned : construction, financial services, insurance & pension, culture and recreation, telecom&IT, transport and travel.

All other trade did not provide an upside.

Like other chinese initiatives, this is more geopolitical and less trade. This kind of summarizes who is pushing for what :

 https://pasteboard.co/IF9hO18.png


Good that we are able to walk away...

chetak
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Re: Indian Economy News & Discussion - Nov 27 2017

Postby chetak » 04 Nov 2019 22:21

Kaivalya wrote:Background data on the historical negotiations that seems to have made no progress from an indian perspective :

https://tejas.iimb.ac.in/articles/RCEP_Implications_for_Indian_Trade_&_Economy_Tejas_Dec_2017.pdf

Summary :

Services was the only upside with 7 service categories assigned : construction, financial services, insurance & pension, culture and recreation, telecom&IT, transport and travel.

All other trade did not provide an upside.

Like other chinese initiatives, this is more geopolitical and less trade. This kind of summarizes who is pushing for what :

 https://pasteboard.co/IF9hO18.png


Good that we are able to walk away...



All these RCEP guys are past masters in the sly game of the active circumvention of rules of origin, especially with regards to India.

The arbitrage on the cheeni import and after repackaging it, re exporting the same to India is their profit.

Even the SL and the BD exporters have been doing this to us since the time of the congis.

kit
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Re: Indian Economy News & Discussion - Nov 27 2017

Postby kit » 04 Nov 2019 23:06

chetak wrote:
Kaivalya wrote:Background data on the historical negotiations that seems to have made no progress from an indian perspective :

https://tejas.iimb.ac.in/articles/RCEP_Implications_for_Indian_Trade_&_Economy_Tejas_Dec_2017.pdf

Summary :

Services was the only upside with 7 service categories assigned : construction, financial services, insurance & pension, culture and recreation, telecom&IT, transport and travel.

All other trade did not provide an upside.

Like other chinese initiatives, this is more geopolitical and less trade. This kind of summarizes who is pushing for what :

 https://pasteboard.co/IF9hO18.png


Good that we are able to walk away...



All these RCEP guys are past masters in the sly game of the active circumvention of rules of origin, especially with regards to India.

The arbitrage on the cheeni import and after repackaging it, re exporting the same to India is their profit.

Even the SL and the BD exporters have been doing this to us since the time of the congis.


more like the pilot fish feeding off scraps from the whale :x

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Picklu » 04 Nov 2019 23:34

We should actually get out of the FTA deal with Indonesia also. Aus and NZ are not that much of a threat due to the transport distance. East Asian countries are much bigger threat.

We need to give them a signal that they can not open their market only 50% and expect a 74% market access from us.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby jpremnath » 05 Nov 2019 04:03

My respect for this government has gone up by multitudes by this one bold step!!...Now we will get additional leverage when we renegotiate the terms for the ASEAN FTA in the coming years.. Those jokers now will know India means business and wont be pushed around like before. They will open up some concessions knowing very well that we can pull out of that nonsense FTA also..

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby tandav » 05 Nov 2019 07:56

The more important question is how do we become competitive. 10 years is a massive amount of time and the world will not wait around. We have to step up our game by orders of magnitude.

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Re: Indian Economy News & Discussion - Nov 27 2017

Postby Mollick.R » 05 Nov 2019 10:52

tandav wrote:The more important question is how do we become competitive. 10 years is a massive amount of time and the world will not wait around. We have to step up our game by orders of magnitude.


tandav jee and other gurus here as India has declined to sign the RCEP and escaped unharmed this time , when we will again asked sit on discussion table or coerce to join RECP ???

Is this RECP meeting thing annual ??? or it will again take place after 10 years ??? :?: :?:
I'm clueless. please throw some light.

kit
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Re: Indian Economy News & Discussion - Nov 27 2017

Postby kit » 05 Nov 2019 16:46

Mollick.R wrote:
tandav wrote:The more important question is how do we become competitive. 10 years is a massive amount of time and the world will not wait around. We have to step up our game by orders of magnitude.


tandav jee and other gurus here as India has declined to sign the RCEP and escaped unharmed this time , when we will again asked sit on discussion table or coerce to join RECP ???

Is this RECP meeting thing annual ??? or it will again take place after 10 years ??? :?: :?:
I'm clueless. please throw some light.



India can join the RCEP any time it wants to ( more than welcome !, as it is one of the biggest markets ), but it's just that the others want India in more than India does. Smart move.


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