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Relief for milk and dairy segment as India opted out of RCEP agreement
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Wednesday, 06 November, 2019, 08 : 00 AM [IST]
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Manjushree Naik, Mumbai
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In a move that will safeguard the interests of the milk and dairy sector in India, apart from many other segments of the economy, Prime Minister Narendra Modi has opted out of the RCEP (Regional Comprehensive Economic Partnership) pact.
The country's largest dairy producer, Amul, has thanked the government for "supporting livelihoods" by saying no to RCEP, which would have opened the floodgates for milk and dairy imports from countries such as New Zealand and Australia to India, the world’s biggest milk producer.
Further, the country could have faced unequal competition from giants like China because of the agreement. It is learnt that while China would have gained access to Indian markets, the same would not have been possible for Indian businesses in that country.
In a tweet, Amul applauded Modi and tweeted, “On behalf of 36 lakh co-op milk producers of Gujarat, we wish to thank PM for his exemplary leadership and support to 10 crore milk producer families of India.” It added, “Your vision of supporting their livelihood will help doubling their incomes and make India stronger.”
The move has come seven years after India joined negotiations for the 16-nation ASEAN (Association for South East Asian Nations)-led RCEP or Free Trade Agreement.
Apart from dairy, various trade bodies and associations lauded India’s decision. Dr D K Aggarwal, president, PHD Chamber of Commerce and Industry, said in a press statement that this is in favour of India’s entire industry, particularly, MSMEs to save them from the repercussions of the RCEP agreement which is not in sync with the growth of trade and industry in the country.
He explained,“The government has rightly taken the decision not to go ahead with signing of the RCEP agreement as it would have resulted in ballooning trade deficit and impacting the MSME sector which does not have level playing field in terms of logistics costs, access to cheap fund and physical infrastructure.”
He added, “India has decided not to sign the Regional Comprehensive Economic Partnership due to differences over tariffs, its trade deficit with other countries and non-tariff related barriers. Non-tariff barriers would create bottlenecks for India to expand its trade and investment with RCEP economies.”
Meanwhile, FICCI (Federation of Indian Chambers of Commerce and Industry), an association of business organisations in India, summed up its views, thus, "We at FICCI fully support Prime Minister Narendra Modi's decision against joining RCEP, as India’s several concerns remain unaddressed and various issues are unresolved so far in the proposed deal under negotiation.”
FICCI president Sandip Somany added, “In recent months serious apprehensions and reservations on RCEP have been expressed by a large number of sectors including steel, plastics, copper, aluminium, machine tools, paper, chemicals, petrochemicals and others. Further, there were not enough positive developments in the area of trade in services including easier mobility for our professionals and service-providers.”
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