Indicating that the rise of three Preferential Trade Agreements (PTAs)- Trans−Pacific Partnership agreement (TPP) Trans−Atlantic Trade and Investment Partnership (TTIP) agreement and EU−ASEAN free trade agreement (FTA) will have far reaching implications to Indian economy, Dr. Surendar Singh, Policy Analyst, Centre for International Trade, Economics and Environment, CUTS International said, “These agreements will also affect the competitiveness of India`s exports in these countries among other impacts.”
Dr. Singh was speaking during the Stakeholder Consultation Meeting on External Preferential Trade Agreements -Its impact on Indian Economy organized by CUTS International in association with PHD Chamber of Commerce and Industry at PHD House, Chandigarh on September 11, 2014.
Earlier, Dalip Sharma, Director, PHD Chamber of Commerce and Industry said, “Today’s meet was organized to generate awareness among the stakeholders, to obtain specific input from the stakeholders about the impact of these external PTAs, to sensitize policy makers as well as other stakeholders to prepare policy response which will prevent the negative impact on the Indian economy from these external PTAs.”
“Interestingly”, said Dr. Singh, “India is not a party to any of these mega regional preferential trade agreements which together constitutes 60 per cent of the World’s GDP. Therefore, the impact of these agreements shall be huge. All importers and exporters doing business with these countries are bound to be impacted with these agreements.”
Dr. Singh said that the results of the study conducted by CUTS indicates that exports of agriculture commodities, processed food, textile and wearing apparel and heavy manufacturing are likely to be affected. TPP & TTIP will create market access issues for non-participating countries in form of higher regulatory standards, labour standards and environmental standards.
Trade and Investment implications, he said, will be greater in case of TPP & TTIP agreement and it will restrict the access of non- participating countries to integrate in TPP & TTIP led global value chain. This may cause shift in production center particularly in textile, apparel and heavy manufacturing.
Outlining what could be the counter strategy, experts present shared that a strategic focus on bilateral trade agreements in TPP region has to be brought in coupled with India’s engagement in Regional Comprehensive Economic Partnership (RECP) may help to mitigate the potential impact of these agreements. Besides, investment in trade related institutions such as Bureau of Indian Standards Act and other bodies to enable compliances and focus on capacity building programs to enhance the knowledge of India trading community could be the clue.
Delving into the issue, Archana Jatkar, Coordinator and Deputy Head, CUTS Center for International Trade, Economics and Environment, said, “Though manufacturers are more than willing to comply with WTO standards, the cost of compliance to the standards set under the Mega FTAs will be huge. That is likely to impact the SMEs the most.”
Col. (Retd.) P K Vasudeva said that US & EU are trying to redefine the international standards to restrict market access for India and other developing countries, adding that India should focus on the trade facilitation measures in order to enhance competitiveness of India’s export.
The consultation meeting was attended by over 25 participants from government, business enterprises and other relevant stakeholders.
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