- November 16, 2020
- Posted by: OptimizeIAS Team
- Category: DPN Topics
Subject : Economy
Context : The Regional Comprehensive Economic Partnership (RCEP), a mega trade bloc comprising 15 countries led by China, that came into existence said India would have to write expressing “intention” to join the organisation to restart negotiations for membership.
- Regional Comprehensive Economic Partnership (RCEP) is a free trade agreement (FTA) between –
The 10 members of ASEAN
Additional members of ASEAN +3 = China, Japan, South Korea
Members with which ASEAN countries have FTA = Australia, 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.
- It includes more than 3 billion people, has a combined GDP of about $17 trillion, and accounts for about 40 per cent of world trade.
- India’s ties with China in recent months have been disturbed by the military tension in eastern Ladakh along the LAC.
- In the meantime, India has also held a maritime exercise with Japan, Australia, and the United States for the “Quad” that was interpreted as an anti-China move.
- However, these moves did not influence Japanese and Australian plans regarding RCEP.
Leverage for China
- Despite the pandemic, the RCEP is certainly leverage for China and shows the idea of decoupling from China is not a substantive issue in a regional sense.
- The agreement means a lot for China, as it will give it access to Japanese and South Korean markets in a big way, as the three countries have not yet agreed on their FTA.
Source : The Hindu