Topics Covered: Important International institutions, agencies and fora, their structure, mandate.
Mega trade bloc RCEP takes off:
Context:
The initialising ceremony of the Regional Comprehensive Economic Partnership (RCEP) was held recently among member-countries on the sidelines of the 37th ASEAN Summit.
About RCEP:
- The mega trade bloc comprises 15 countries led by China (10 ASEAN members and Australia, China, Japan, South Korea and New Zealand).
- The group is expected to represent at least 30% of the global GDP and will emerge as the largest free trade agreement in the world.
- The mega trade bloc is expected to boost commerce among the member-countries spread across the Asia-Pacific region.
Aims and Objectives of RCEP:
- To lower tariffs, open up trade in services and promote investment to help emerging economies catch up with the rest of the world.
- To help reduce costs and time for companies by allowing them to export a product anywhere within the bloc without meeting separate requirements for each country.
- It also touches on intellectual property, but will not cover environmental protections and labour rights.
Why does it matter?
It mainly matters because it sets new trade rules for the region — and has China’s backing but does not include the United States.
- Observers say it solidifies China’s broader geopolitical ambitions in the region.
Why no India?
India withdrew last year over concerns about cheap Chinese goods entering the country, though it can join at a later date if it so chooses.
- It raised alarm about market access issues, fearing its domestic producers could be hard hit if the country was flooded with cheap Chinese goods.
- Textiles, dairy, and agriculture were flagged as three vulnerable industries.
InstaLinks:
Prelims Link:
- RCEP- composition and objectives.
- India’s free trader agreements with ASEAN countries.
- Geographical location of asean countries.
- Aims and objectives of RCEP.
Sources: the Hindu.
