India mulls import tax in RCEP talks
India plans to propose the imposition of "safeguard tax" on imports to better protect domestic industries as part of the long-awaited Regional Comprehensive Economic Partnership (RCEP), which is supposed to reduce trade barriers.
A government source cited a news report in India that says New Delhi wants the 16 RCEP members to adopt the proposal which will allow its members to impose tariffs on products likely to be imported to a country "without a need to run a check on possible damage" caused by relaxed international trade rules.
Its move was unveiled just before the next round of RCEP trade talks in Da Nang, Vietnam, later this month.
The proposal is part of attempts to mitigate the negative impact caused by RCEP which seeks deeper economic cooperation, including free trade, among 10 Asean countries and six dialogue partners, namely China, Japan, South Korea, Australia, India and New Zealand.
The mitigation measures are among 20 issues raised at the negotiating table. So far seven of them have been settled. Asean has been selective about safeguard taxes, the source said. Thailand, for example, will use this tariff measure only after it can prove damage caused by imports in an investigation which normally takes at least six months.
Free trade is a sensitive issue in the RCEP. Slow progress has been made since their initiation in 2012 mainly due to a lack of free trade agreements (FTAs) between some partners, such as China-Japan, India-China and India-Australia-New Zealand. According to the source, these countries are being asked to free up their markets by between 80 and 86%.
Earlier this month, ministers of participating countries agreed to conclude the talks in Da Nang. "It may not be a 100% end," the source said. But some members suggested RCEP leaders announce success if 80% of contentious issues are thrashed out. The announcement should be made during the Asean Summit in Bangkok in November, the source added.
Auramon Supthaweethum, director-general of the Trade Negotiations Department, said earlier Thailand will hold bilateral negotiations with India, Japan and New Zealand in a bid to finish the talks by November.