Regional Comprehensive Economic Partnership is a free trade agreement that concluded on November 15, 2020, between 15 countries of the Asia-Pacific region after almost nine years of talks, negotiations and meetings among its partners on various agendas. These countries are Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, Philippines, Singapore, S Korea, Thailand and Vietnam. It is approximately 30% worth of the Global GDP, i.e. $26 trillion. It is claimed that it is one of the biggest free trade deals in history.
What Will The RCEP Do?
This partnership will remove layers of tariffs on imported commodities from the member countries over the next 20 years. This is not very different from the TPP, EU, BRICKS, OPEC, EFTA and other such “free-trade” organisations (out of WTO) whose aims are to reduce the burdens of bureaucracy, national boundaries, tariffs and competition among the members, thus competing with the other nations outside the trade-zones, to ensure that industrialists and merchants gain a high profit rate. In short, such deals encourage creation of official cartels. It is an effort to share the bigger pie in the world market by pushing others out.
Will it benefit all the members equally? Our natural instinct is NO. And it is not due to different currencies, production outputs, productivity, the culture and customs of one’s own country, product quality, labour value (cheap or expensive) and lifestyle, standard and uses of science and technologies, level of industrialisation, etc.
Who Will Benefit The Most From The RCEP?
Stronger economies such as China or Singapore in this case will make better use of the RCEP compared to others. India would not have felt like a fish out of water had its domestic economic policy been competitive for all capitalists, industrialists and manufacturers, but it is not so. It is pro a few oligarchs and therefore, the full potential of productive forces is unutilised (it is down to 65-70% approximately and is likely to worsen due economic recession, which has shrunk the demand badly).
Incidentally, to think free-market exists today (anywhere in the world) is folly, as monopoly capitalism has superseded that more than a century back. Also, in all analysis, we must include capitalist mode of production, which regularly brings economic crisis and keeps the army of unemployed labour intact, whether big or small, depending on the severity of the crisis.
India Opted Out Of RCEP
India opted out of this partnership last year itself, citing it as anti-India trade requirements.
“PM Narendra Modi had in November last year said the decision to not be a part of RCEP was guided by the impact it will have on the “lives and livelihood of all Indians, especially vulnerable sections of the society”.” (https://theprint.in/theprint-essential/how-will-rcep-benefit-member-nations-and-what-does-indias-exit-from-the-trade-pact-mean/545701/). This speaks weakness of Indian economy, despite all boasting.
Free Trade Agreement (FTA) with the various members of the ASEAN countries and their partners will not give all the facilities for the so-called Free Trade in the RCEP members to India. It is also conceived to be giving an appropriate competition to the American led TPP (Trans-Pacific Partnership, later became CPA-TPP), which was working against Chinese economic expansion in the world market. However, US itself left this agreement in 2017, when Trump “felt” it was against American manufacturing interest.
India, a capitalist country, reeling under fascism, is committing series of blunders in domestic as well as in international policies! Not joining RCEP is one of the examples! China called it “strategic blunder” and India “missed the bus” (https://www.hindustantimes.com/world-news/india-will-miss-the-bus-to-economic-development-by-not-joining-rcep-chinese-state-media/story-LTv6pnvOHhJ8ZOigHtyXbJ.html), but that is not important for India, as it has to see its own interest, but perchance it is true. Though, as the rule of RCEP says, India can join in future, as the doors are open for it.
The Biggest Gainer Is China
Due its sheer size, strategic location, industrial and economic might, control over the gigantic skilled, disciplined, yet cheaper manpower due huge unemployment, latest science and technology in almost all the fields, political say in the world affairs (It is permanent member of UN Security Council) China has to be the biggest gainer. China Daily claims, “China’s goal is to see that multilateralism triumphs over unilateralism. To confirm this, when the African Continental Free Trade Agreement came into operation on May 30, China was the first nation outside the continent of Africa to endorse the pact.” (https://global.chinadaily.com.cn/a/202011/18/WS5fb47598a31024ad0ba94ce9.html)
“Multilateralism over unilateralism” is a rhetoric. Chinese aim is very clear, to be world’s economic power No 1 by 2030, followed by the military superiority over any other world powers. China’s unwillingness to get into any conflict is part of that aim, laid by the late Deng Xiaoping and CPC. For that aim, it is ever willing to lower its profit rate on its commodities and capital (advanced as loan) in the world market. BRI is part of that aim. Indo China conflict was a surprise in Ladakh region. Peaceful settlement of China Russia International boarder is part of that aim. War with Vietnam was a very costly affair to China, and will not like to repeat that blunder in near future.
International Relation is huge and of utmost important matter for any country. It must not change overnight or at a short and at a regular interval, after a change of a regime, or a political party in the power or PM or President. A committed group of policy makers is essential, which must include experts on various regions, countries, faculties, like economy, oceanography, military, geopolitics, even science and technology, etc. The top leaders must adhere to their direction. It is directly proportional to the national interest, while it effects the national interests, political economy and even the people’s mindset. Here, the example of US foreign policy may be quoted, when Trump came to power and his short sightedness as well as fickle mindedness, made porridge of it and US became a laughing stock. If we go to history, we see similar case in USSR, when Khrushchev came to power, after Stalin’s death, the former made foreign policy his personal domain of show of his speech ability, even without preparation, sans with knowledge.
Earlier Indian Foreign Policy: The Indian ruling party, when Congress was in the driving seat, maintained some form of decorum, consistency, non-alignment policy (Even after disintegration of the USSR), relations with the neighbours based on equality, reliable partnership with any country. This gave India respectability in the world community and better trade relations. Intervention of Indian Army in Sri Lanka was blunder, wonder whose decision was that, of solely Rajiv Gandhi or that of foreign policy makes, in consultation with the top military officers!
Present India vis a vis the World: Now, however overtly India may claim and affirm that it is respected in the world community, that it is marching forward towards 5 Trillion USD economy, it has given International Yoga Divas, it is becoming World Guru, it is a huge market, its PM makes US, Chinese, Japanese and many top countries’ leaders dance on his tune, he entertains foreign Indian diaspora (on huge cost, born by the Indian hard working but poor people), but in final analysis and outcome, it has failed to follow a consistent and pro people international policy. In fact, it has become a matter of concern even in its allies’ circles, if not a laughing stock, like that of Bolsonaro, Brazil PM.
Who can change foreign policy? Hope, the people of India do realise, who are immensely suffering due fascism, will change the existing order, more so when India is in economic recession officially, in addition to the coronavirus pandemic.
Indian location is strategic geographically, and due its large area and population, important neighbouring countries, fifth largest economy in the world, a powerful military, a nuclear and space power, advanced science and technology, its geopolitical importance is huge, even though it has not been able to assert that potential so far. There are many reasons for that, which are glaring now, like leaving NAM, becoming shadow of US/Israel foreign policy and geopolitics, not enough representation in UNO, etc.
This however, doesn’t mean India makes drama out of the foreign policy. Rhetoric and jingoism will never have long lasting effect on either domestic or foreign policies, in fact it will be harmful in most of the cases. See the Chinese foreign policy, it is strategic and doesn’t change for some minor gains, be it economic or political. Compare that with Mr. Modi joining Trump’s election propaganda, who eventually lost.
World is at cross road. Leadership of any country is very important. Right Wing political parties are unable to meet the working-class aspirations and requirements and a revolutionary change is lurking on the horizon. In this case, our advice to them is like telling monkeys to follow table manners, while having a meal, like gentlemen!
This article is obviously for the students of the Geopolitics and not for the monkeys, err, the Right-Wing politicians, who are not willing to mend their ways, due ignorance and arrogance, nor they are ever going to listen or read our such posts, advices!