A study released by a reputed American think-tank, reflecting the broad position of the US government and industry, makes a strong push for India joining the next stage of the Trans-Pacific Partnership (TPP) in order to spur its growth rate to 10 per cent through a series of trade liberalization measures.
The study, authored by C Fred Bergsten, founding director of the Peterson Institute for International Economics, argues that India’s competitiveness problem is compounded by its absence from the world’s new mega-regional trade agreements, especially the 12-nation TPP and the Trans-Atlantic Trade and Investment Partnership (TTIP).
India’s participation in an expanded TPP or a new Free Trade Area of the Asia Pacific (FTAAP), either of which could include China as well as the US and Japan, will have the potential to expand its exports by $500 billion and GDP growth by 4 per cent, says the study, titled: “India’s Rise: A Strategy for Trade-led Growth.”
It argues that India’s international competitiveness has declined, marked by stagnation of exports in recent years. It goes on to say that India continues to emphasise unambitious trade deals with relatively minor players as it faces increasing discrimination in global markets while other major countries, including China, US and EU, conclude or contemplate new preferential megaregional agreements.
Entry into TPP, however, comes with a range of conditions as part of its goal to lower trade barriers, establish a common framework for intellectual property, enforce labour and environmental standards and create an investor-State dispute settlement mechanism.
That these may just not be acceptable to India was conveyed in broad terms by Indian Ambassador Arun K. Singh at an event to mark the release of the Peterson study. Even while commending author Bergsten’s intellectual stature, Singh commented: “I don’t necessarily agree with all the findings and analysis.”