RCEP Drama - India's Future and China's Trap #NO RCEP:
Why didnt India join RCEP?
Many say that if India has joined RECP India could have earned a lot of Profits.
Some ask the question,
What could be the reason India Refused RCEP?
Some Politicians told India Could or Could not join the RCEP.
What is happening with this RCEP?
What is RCEP?
Will China’s Domination be the frontline for RCEP?
Why America was left out?
Why Did India Refuse to join RCEP?
Let’s discuss in detail.
Beloved Tamil People. Greetings from Tamil Pokkisham.
RCEP means Regional Comprehensive Economic Partnership.
15 Countries have joined RCEP. RCEP means the Free Trade Agreement(FTA).
What is this free trade agreement?
One Country will sign this agreement with another, they can import and export goods the tax rate will be very low. But any amount of goods can be imported and exported there are no restrictions. So both countries will have their say and if both countries accept the terms then they will sign the agreement.
But through RCEP nearly 15 Countries have joined forces. The 15 countries GDP is 30% in the world Economy. A total of 2.1 Billion people are in these 15 Countries. China is strongly present in the RCEP.
Did America avoid RCEP so China can take over it?
America has been a part of another group called Transpacific Partnership. Nearly 16 countries were a part of this Transpacific Partnership. When Trump became President he declined Both Transpacific and RCEP.
What was the reason for Trump’s actions?
Trump said that many Unwanted products have been dumped in America. The Products needed for Americans will be produced by America. He also said that if needed he will sign a free trade agreement with other countries. So he quits Transpacific partnership. Trump didnt want to join RCEP because of China.
The discussion for RCEP began in 2012. China was the country which was very eager to form the group. China’s Ultimate aim is to complete the Belt and Road Initiative(BRI). BRo is focused in surrounding India from all corners. But there are chances that China’s trade will grow exponentially. So to successfully accomplish this they need Belt and Road Initiative through Road and Sea. China has already invested nearly 1 Trillion USD into the Project. Through this Initiative, they have loaned money to many countries and changing those countries into Slaves of China like Pakistan and Srilanka.
China Pakistan Economic Corridor, China Srilanka Economic Corridor there are so many.
China’s Promise to these countries is both the Countries economics will grow. Many Countries believed in the Evil Dragon and lend money from its belly. But after some days the Countries knew the truth that the Dragon made no Promises but its a Debt Trap. So by lending money which is unpayable by the other country then enslaving them is what China is doing now around the world.
What is the link between RCEP and Belt and Road Initiative?
Now we should know about Imports and exports. China and America are in a Trade war. This was the reason why America and China Agreed to Phase1 agreement.
America says that China is exporting more goods and Importing a low amount. So America says that China has to export 200 Billion Worth Products for One year. If China doesnt agree, America says it will ban Chinese products. China has to agree and this became the Phase 1 agreement. The Trade war happened for three years and through Discussions China accepted to export 200 Billion USD worth Products. Thus Phase 1 agreement was signed.
Similar to this for every country there is an issue in importing and exporting products. This issue is called the Trade Deficit.
When we speak about India and China. China is exporting a large number of Products into the Indian market. The trade Deficit which India has with China is nearly 50 Billion USD. In 2012 China’s Dream was to become a superpower within 2020-2035 called China’ Dream.
When this happens many countries will stand against China. So China has to make this trade agreement signed. China’s remedy is RCEP. Many Countries have trade Deficit with China. From China, large quantities of Products are exported to many countries. Through RCEp China’s Business will feed the dragon exponentially. The Countries which trade with China will lose money through Trade Deficit to China. This is the situation between China and other countries.
When it comes to India, the ASEAN countries ( Association of South East Asia nations). There are ten countries in this ASEAN. India has FTA(Free Trade Agreement) with these Ten Countries. This is called the AIFTA. So through AIFTA, we can have free trade with Ten ASEAN countries. ASEAN + China, South Korea, Japan, New Zealand and Australia. SO ASEAN countries and the other 5 countries combined have signed RCEP agreement.
India has trade Deficit with these 5 countries China, South Korea, Japan, New Zealand and Australia. India is importing large quantities but exporting low amount of products to these five countries. India has signed an agreement with Japan Called CEPA(Comprehensive Economic partnership agreement). This is a Free trade agreement between India and Japan. India has CEPA with South Korea also. India is in the discussion of whether to sign CEPA with New Zealand and Australia.
So according to this India has a free trade agreement with Ten ASEAN Countries and these 4 countries. Only New Zeland and Australia have not yet signed the agreement but theoretically, we have signed it.
India doesnt do Free Trade Agreement with China.
So the countries which are in RCEP 14 of them already have Free trade Agreement with India.
What is the point of signing RCEP when there is only CHINA left?
Indian Small and Middle-Class Businesses urge the Indian govt not to ever sign the RCEP agreement for no reason. If India signs the agreement low-quality products from China will be dumped into China. If India signs the agreement with RCEP which is China, then the Indian govt cannot restrict China’s Imports into India. There will be no tax on these products. There will be no customs Clearance. So if we sign the agreement, Our Indian Businesses started to protest against RCEP. So in 2019, the Indian govt says that it has no intentions of Signing the RCEP agreement.
From 2019 whether it’s Vietnam or Japan were pressuring India to sign the RCEP agreement. If India joins the group they can easily isolate America. The Reason India why didnt sign the RCEP is the Indian Businesses Protest and Opposing parties protest. Congress strictly were against RCEP. But the real reason is India’s economy will be affected if we sign the RCEP agreement.
You may ask us a question,
How will the Indian Economic fall?
The reason is India has CEPA agreements with Japan and South Korea. Now if you see the graph we can clearly understand that after signing CEPA Japan’s Exports to India has increased. So Japan in earning profits whereas India is earning low profits resulting in Trade Deficit. Let’s look at the stats with South Korea. India’s exports 4 to 5% increased compared to South Korea’s 36 to 39% Increase in Exports.
So through Free trade agreement signed with these countries, India is dependent on other countries.
What must India do to change this?
Our govt has to start planning and change the infrastructure of India.
Is the Current govt doing this?
Or Is The Current govt still favouring Corporates?
These questions are still unanswered. We need a strong Opposing party in India. We are in need of a strong Opposing party leader because when it comes to India’s Economic there must be a debate instead we are having unwanted discussions.
In 2019 Congress said that India should not sign the RCEP agreement. Some Politicians like PA Chimadambaram asked Why India is not signing RCEP agreement?
So there are two sides to Politics. So a clear decision cannot be taken. The Normal People and the businesses which are dependent on the Govt are greatly affected.
India should be able to export a huge number of products to other countries. Thus India can earn profits through Free trade Agreement by avoiding Trade Deficit.
Why China is very eager for countries to sign the RCEP?
What will happen after the Coronavirus Pandemic?
Many countries around the world will isolate China. Through De-Coupling Method, China will be left out and Globalization will come. World Trade Organization will come into the picture. So Through WTO, any country can trade with other countries. This market is now heavily damaged. Many Countries want to avoid China, Japan companies many have exited China and have gone to many countries. America and India are doing the same. When Many countries pullout from China, The Dragon’s economic will go down. China is dependent on Production and Exports. So if the Exports come to a halt China’s way of Life will also be halted. China’s GDP will be no more, and The China Dream will become into ashes. So to save this China have made the countries sign the RCEP agreement.
Now If China has a discussion with the New American President and convinces him to continue the Phase 1 agreement. Then China will take control of the World.
How China can control the Whole World?
RCEP Countries GDP Contributes nearly 30%GDP to the world. If China controls this GDP then using this they will automatically control the other countries.
RCEP’s Leader and authority is China. This is the reason India avoided RCEP. India now says it may sign the RCEP agreement. Many countries have supported India to just be an Observer in RCEP. So for India, it’s not life or Death Situation. India has already signed FTA with the other 14 countries excluding China.
India demanded that changes to be made if it has to join the RCEP agreement. If a country exports above a threshold, the Auto Trigger should happen. Auto Trigger is a system where products taxes will be increased. Through this Auto trigger, we can stop the low-quality products being dumped into India. But RCEp refused India’s Demands. Then Comes MSN a country should not favour another country because it is their ally so allowance can be given to that particular country. This was another of India’s Demand. Both Demands have been rejected, this is the reason why India didnt join RCEP.
IF India’s demands were accepted, and India’s Infrastructure was changed to export the huge number of Product to escape Trade Deficit. When that time comes India can join RCEP thus resulting in a profitable agreement.
Due to Political and other Pressures, if India joins RCEP, this will be a huge loss for India and its Manufacturers and Suppliers.
IS RCEp good for India or not?
When Can India join RCEp?
Can India Form another group like RCEP and be its Leader?
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