The Trans-Pacific Partnership (TPP), or the mega-regional
free trade pact led by the U.S. and including 11 other Asia-Pacific
countries, is likely to indirectly impact India’s exports in several
Sector such as textiles, plastics, leather, clothing,
cotton and yarn, besides the country’s regime on investment, labour
standards, intellectual property rights (IPR), government procurement and
State-owned enterprises (SOE) will face problem.
The challenges arising from the TPP — which has set very
high standards for the international trading regime — could be similar to
those experienced by India post the 1991 economic liberalisation.
The External Affairs Ministry would soon do a study in
the context of TPP and in- form the government what the priorities should be
in terms of policy-making in the next six months.
The TPP agreement (which India is not a part of) was
reached in October last year and the member countries have two years to
ratify the pact. In the meantime, the Indian government will have to
consider improving the country’s standards in areas such as labour laws by
holding stakeholder consultations.
The investor-State dispute settlement mechanism adopted
by the TPP was also a concern from India’s point of view.
Some of the TPP standards were higher than that of the
WTO norms, including on IPR and possible ever-greening of patents, which
could hurt India’s pharma sector.
The operations and the production methods of India’s
public sector units (or SOEs) could also be constrained due to the TPP.
Several Indian export sectors such as cotton and yarn
could be affected as trade may be diverted to the TPP region due to its
benefits of low or nil duties.
Pointing out that the TPP, RCEP and the Transatlantic
Trade and Investment Partnership (a proposed mega- regional between the U.S.
and the European Union) excluded African countries, the Minister said India
would also have to focus on improving its trade with African countries.
Meanwhile, India is also considering engaging with the
Asia-Pacific Economic Cooperation countries to ensure that it did not miss
out on the emerging trade dynamics.