Wednesday 7 December 2022
- Advertisement -
EconomyWhy India opted out of trade talks with US-led group of Asian...

Why India opted out of trade talks with US-led group of Asian countries

India opted out of talks with a US-led group of Asian countries, again avoiding easing access to its markets via a multi-country deal while moving ahead with the others in areas including supply chains and clean energy. The South Asian nation was the only participant in the 14-nation Indo-Pacific Economy Framework that did not sign on the group’s negotiation track on trade, according to statements released after two days of meetings in Los Angeles.

Known as IPEF, the initiative is an effort by the Joe Biden administration to deepen ties with Asian countries through a range of issues including trade, climate change, supply chains and taxation. It’s also among US levers to counter China’s rising influence, although US officials have stressed that they are not asking partners to choose between Washington and Beijing.

India had made a similar move in 2019 when it decided to exit talks on the China-backed Regional Comprehensive Economic Partnership, the world’s largest regional free- agreement that includes nearly a third of the global population and gross domestic product. Prime Minister Narendra Modi said at the time that he had pulled out due to concerns about the exact impact of the RCEP on the livelihoods of Indians, particularly the most vulnerable.

India, US have different reasons

US officials had in a briefing yesterday said that New Delhi’s decision not to join the group demonstrated the flexibility built into the IPEF framework, with US Representative Katherine Tai adding that bilateral trade talks will continue between the US and India.

Union Commerce Minister Piyush Goyal said in a briefing that the benefits to India were still unclear from commitments related to issues around the environment, labour and digital trade. He said India wanted to avoid any condition that would harm developing countries. He said that India would stay engaged and "wait for the contours to be decided before we formally associate with the trade track".

After launching in May, representatives from IPEF countries met for the first time this week to define their main negotiation tracks. Secretary of Commerce Gina Raimondo, speaking at the same briefing, said that there’s no consensus yet on when IPEF would complete negotiations on its four tracks or "pillars".

In addition to trade, those were labelled yesterday as supply chains; a clean economy, which focuses on the transition to renewable energy and fighting climate change; and a fair economy, which includes taxation and corruption issues. All 14 countries signed on to those three.

The countries are working on a "really aggressive timeline," Raimondo said. In May, a US official said that the Biden administration was aiming to have substantive commitments in about 12 to 18 months. Raimondo added Friday it would be positive to have IPEF pillars agreed to by November 2023, when the US hosts the Asia-Pacific Economic Partnership forum, which promotes free trade.

"There’s such eagerness to get the United States back in the region in a big way," Deputy US Representative Sarah Bianchi told reporters. "There’s just a view that if we can do an agreement that we all sign on to, that it really will be durable and lasting and wo not have to go through some of the more political aspects of our system."

Click/tap on a tag for more on the subject

Related

Of late

More like this

[prisna-google-website-translator]