India on Monday decided against joining the Regional Comprehensive Economic Partnership (RCEP), the mega Asian trade agreement between 16 countries with almost half the world's population, saying its core concerns were not addressed.
Sources said Prime Minister Narendra Modi stood firm on India's demands, adding key concerns were not addressed. India has time and again made it clear that there will be no compromise on core interests.
Underlining India's concerns, Modi, in his speech, said: "Our farmers, traders, professionals and industries have stakes in such decisions. Equally important are workers and consumers who make India a huge market and the third biggest economy in terms of purchasing power parity."
The Confederation of Indian Industries (CII) appreciated the government's stance to opt-out of the Regional Comprehensive Economic Partnership (RCEP) agreement, and vowed to continue working to integrate India's economy with that of the world.
In a statement, CCI president Vikram Kirloskar said the long-term interest of India's industries lies in getting integrated with global values chains and urged all 15 countries onboard the RCEP to work with India to resolve India's "very legitimate concerns".
"We sincerely hope that these issues will be resolved soon to the mutual satisfaction of all RCEP countries," their statement read.
Government sources told ANI that gone are days when Indian negotiators caved into pressures from global powers on trade issues.
"This time, India played on the front foot, stressing the need to address its concerns over trade deficits and need for countries to open markets to Indian services and investments," a source said.
India's core concern, according to ANI, include inadequate protection against import surge, insufficient differential with China, possible circumvention of rules of origin, keeping the base year as 2014 and no credible assurances on market access and non-tariff barriers.
The prime minister added that when we look around, we see during 7 years of RCEP negotiations many things including global economic and trade scenarios have changed. "We can't overlook these changes. Present RCEP Agreement doesn't fully reflect basic spirit of RCEP," he said, according to sources quoted by ANI.
The proposed free-trade agreement includes 10 member-countries of the Association of Southeast Asian Nations (ASEAN) and six of the bloc’s dialogue partners — China, Japan, South Korea, India, Australia and New Zealand.
Earlier in the day, Australian Prime Minister Scott Morrison said the door will remain "wide open" for India to join the 16-nation partnership if it decides to do so, as the others were on board in finalising the deal without New Delhi.
"The door will always be open to India," Morrison was quoted as saying by the Australian Associated Press (AAP).
He also said that the deal would be bigger and better with India in it.
"It has always been our view, and the view of many who sit around the table, that this is a bigger and better deal with India in it," Morrison said.
"I think patience is the virtue in this," he added.
When finalised, the RCEP would become the world’s largest free trade area, comprising half of the world population and will account for nearly 40 per cent of the global commerce and 35 per cent of the GDP.
(With inputs from agencies)