Trade Interests, not Diplomacy, will Decide the RCEP Pact, says Jaishankar

The mega Regional Comprehensive Economic Partnership (RCEP) pact being negotiated by India with 15 countries, including the ASEAN and China, will be defended and decided upon by primarily trade merits and not diplomacy, Minister of External Affairs S Jaishankar has said.

“RCEP is a trade agreement. A trade agreement must be defended and decided upon by trade merits. There are diplomatic aspects, consequences, handling etc involved. But the primary justification of a trade agreement can’t be diplomacy. It has to be trade,” Jaishankar said at a press conference on Tuesday, 17 September when asked if saying no to the RCEP agreement will be acceptable from a diplomatic point of view.

A number of industrial sectors ranging from steel, engineering goods and automobiles to leather goods and textiles have raised concerns on increased competition in the domestic market, especially from China, once the RCEP pact is finalised. The agricultural sector and the dairy industry, too, have expressed their apprehensions about the proposed agreement. The other countries in the grouping are South Korea, Japan, Australia and New Zealand.

On the trade tussle going on between the US and India in a number of sectors, Jaishankar said that trade problems happened with the closest partners as the level of bilateral trade was high. “My expectations is that some of the sharper edges will be addressed in some form in the not too distant future. Exactly which ones is the Commerce Minister’s domain,” he said making no direct reference to the possibility of a trade deal being announced when Prime Minister Narendra Modi meets US President Donald Trump in the US later this week.

The Foreign Minister added that he would prefer to look at the 90 per cent of the glass that was full and not the 10 per cent that was empty. “I will look at all the business deals that have taken place (between India and the US) and take that as the state of our relationship,” he added.

He added that US President Donald Trump’s decision to attend with Prime Minister Narendra Modi the event organised in Houston on September 22 was a great achievement for the Indian-Americans and was an indication of the height the community had reached.

Replying to a question on what India’s stand would be on purchasing oil from Iran in the near future, Jaishankar said that India’s interest was in an affordable and predictable supply of oil. “In Iran the situation is not a standing situation. There are a lot of conversations and moving parts to the issue some of which surfaced at the G-7 meeting on the sidelines. Let us see where it goes,” he said.

New Delhi stopped all purchases of oil from Iran earlier this year following implementation of US economic sanctions against the Islamic Republic’s nuclear programme.