India awaits offers on easy access to professionals across borders
Ahead of a meeting of trade ministers of 16 Asia-Pacific countries including India and China next month for a mega regional trade agreement, New Delhi is yet to get binding offers for easier movement of professionals across borders.
Despite pressure to conclude the Regional Comprehensive Economic Partnership (RCEP) trade agreement this year, officials said that many member countries have not offered concessions on computer-related or information technology services and simpler cross-border movement of professionals.
“Computer related services is a sector of our interest and in that Mode 4 is our main concern,” said an official in the know of the details.
Mode 4, or movement of natural persons, is one of the four ways through which services can be supplied internationally. It includes movement of natural persons such as independent professionals and is of key interest to India.
The 16-member RCEP grouping had earlier rejected India’s proposal for a visa fee waiver on a common reciprocal basis, and an RCEP Business Travel Card aimed to facilitate liberal movement of professionals and tourists in the region fearing migration and subsequent loss of jobs.
RCEP is a proposed regional economic integration agreement among 10 Asean countries and six free-trade agreement (FTA) partners, namely, Australia, New Zealand, Japan, China, South Korea and India.
“Some countries are yet to make binding irreversible offers. They haven’t provided adequate offers on specifically Mode 4 within IT services,” the official said. The members are close to concluding two more chapters in telecom and financial services, which will take the number to nine of the total 16 chapters.
The RCEP trade ministers will meet in China on August 2-3, wherein members are likely to discuss commitments in services through negative list and state the exceptions to services they want to open up.
While India has submitted its commitments in services on a negative list, the official said members are reluctant to make commitments. The trade bloc has opened 100 of the 160 sub-sectors in services.
India is likely to gain only $2-$10 billion by exporting services to the pact and will not compensate for the higher amount of goods imports, one of the three government-appointed think tanks to study the pact, said.
GOODS, INVESTMENT While India’s proposal on investor state dispute settlement (ISDS), advocating the exhaustion of local remedies before an investor can take state for a dispute, has found support from the ASEAN and New Zealand, New Delhi is awaiting adequate tariff concessions for its merchandise exports.
India is pushing to secure a gap between the number of Chinese products on which it can give duty cuts compared with the concessions it can get from Beijing for its exports. The mechanism will help contain India’s burgeoning trade deficit with China, which is feared to rise further if the pact is inked. India’s trade gap with China in 2018-19 was $53.6 billion.
India has several sensitive areas of competing interests in agriculture, horticulture and dairy with other non-FTA partners like Australia and New Zealand. Similarly, the Philippines, Vietnam and Indonesia have not matched India’s offers in goods. India has offered 88 lines for duty cuts and they have given 84.