India's potential exit from negotiations for the Regional Comprehensive Economic Partnership (RCEP) would deal a heavy blow to the bids by 16 Asian and Oceanian countries to create a giant free trade pact covering half the world's population and a third of global trade and gross domestic product. While China appears ready to proceed with the talks without India, Japan needs to take the lead to bring the South Asian country back into the fold to reach a successful conclusion of the RCEP negotiations and maintain the momentum for expanding free trade.
At the summit held in Bangkok last week, leaders of the countries participating in the RCEP negotiations — Japan, China, South Korea, India, Australia, New Zealand and members of the Association of Southeast Asian Nations — failed to wrap up the talks by their year-end target due to objections by India, which reportedly fears increased imports from China through the pact would damage its domestic industries.
A joint statement by the RCEP leaders said 15 participants — not including India — "have concluded text-based negotiations" on all 20 fields of discussions and "tasked legal scrubbing by them to commence" for signing the deal in 2020. It noted that India "has significant outstanding issues, which remain unresolved," that all RCEP participants will work together to resolve those issues "in a mutually satisfactory way" and that "India's final decision will depend on satisfactory resolution of these issues."