India Achieves ‘RCEP Minus China’ Strategy Through Bilateral Free Trade Agreements
Following the conclusion of Free Trade Agreement (FTA) negotiations with New Zealand, India has effectively achieved a "RCEP minus China" trade strategy. India withdrew from the Regional Comprehensive Economic Partnership (RCEP) in 2019 due to concerns over Chinese manufacturing dominance and potential trade deficits. By signing bilateral FTAs with 14 of the 15 RCEP members (excluding China), India secures market access without the risks of a multilateral pact that includes China. This approach allows India to maintain safeguards for sensitive sectors while integrating with the ASEAN-led economic bloc through individual agreements, avoiding systemic trade vulnerabilities.
Key Points
- India has secured trade deals with all RCEP nations except China by concluding an FTA with New Zealand.
- India opted out of RCEP in 2019 to protect its domestic industry from duty-free Chinese imports.
- The 'RCEP minus China' strategy provides market access while avoiding the risks of a China-centric multilateral pact.
- India and China remain signatories to the Asia Pacific Trade Agreement (APTA), which offers limited preferential tariffs.
Exam Facts
- India refused to join the RCEP in November 2019.
- RCEP includes 10 ASEAN members plus Australia, China, Japan, South Korea, and New Zealand.
- The FTA with New Zealand was announced on December 22.
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