RCEP pact should be sealed soon to avoid losing credibility

ASEAN leaders and their six key trading partners tried to sound upbeat about the failure of the Regional Comprehensive Economic Partnership (RCEP) to conclude their negotiations last week. Instead, they collectively vowed to seal the pact by the end of 2019. When it does get done, the trade pact will be the world's biggest economic grouping, accounting for 40 per cent of global trade and 45 per cent of the world's population.

It would take in the world's second- and third-largest economies as well as India. Talks started in 2013 and were to have been completed by 2015. It says something about the obstacles that had to be overcome, that the target date has been pushed back time and again. As it stands, seven of the 16 chapters are settled. But in these kinds of negotiations, the principle that "nothing is done until everything is done" prevails. Thus the deal could still come a cropper.

Behind the scenes, fingers are pointing at India as the party that is dragging its feet. It is true that Delhi is a tough nut to crack when it come to opening up the country to trade; for historical reasons it has some of the world's toughest negotiators. The country remains a largely protected economy. India has among the world's highest effective tariffs on food items, motor vehicles and industrial inputs. The World Bank, for instance, has singled out India for resorting to trade remedy measures such as anti-dumping tariffs to keep out competition in recent years.