ASEAN Summit: Is India serious about regional trade pact?

Agencies
November 19, 2018

Singapore, Nov 19: If you were here in Singapore for the first time on a brief visit last week, you could be excused for wondering if it's normal for thousands of police officers to be patrolling the streets and for scores of Special Operations Command and other police vehicles to be parked all over the city. You may also be wondering if traffic is always really this bad.

Actually, no. Singapore is typically very safe and the police is usually not seen much. Neither will you hear sirens piercing the air every few minutes like in some other cities. And it's uncommon for traffic jams to occur.

Last week, besides the leaders of the 10 ASEAN countries, some of world's top leaders including Indian Prime Minister Narendra Modi, Russian President Vladimir Putin, Chinese Premier Li Keiqiang, Japanese Prime Minister Shinzo Abe, South Korean President Moon Jae-in, Canadian Prime Minister Justin Trudeau, Australian Prime Minister Scott Morrison and United States Vice President Mike Pence were in Singapore for the ASEAN Summit. Hence, the stepped-up security.

The world leaders who came, see this as a fantastic and convenient opportunity to meet at the sidelines of the summit to discuss bilateral issues especially ahead of the APEC Summit which takes place in Papua New Guinea immediately after the ASEAN conference. For example, President Putin met with Japan PM Abe as well as Vice President Pence. President Putin's attendance also allowed him to project Russia's desire to be a global influencer and show their willingness to engage with the region especially in economic matters.

The Association of Southeast Asian Nations or ASEAN is a regional intergovernmental organisation made up of 10 countries to promote and facilitate cooperation mainly in trade but also in security matters, education and culture integration and exchange. Meetings at various levels are held regularly with its secretariat located in Jakarta, Indonesia.

Together, ASEAN forms a market of US$2.6 trillion with a population of 622 million people. It is collectively the third largest economy in Asia after China and Japan and seventh largest in the world.

At the moment, the over-arching economic objective for the group is to achieve full economic integration by way of a single market fully connected with the global economy by 2025. Called the ASEAN Economic Community (AEC), it is a free trade zone copying the European Union model loosely.

In his opening address as Chairman of ASEAN, a title and responsibility which rotates among the countries every year, Singapore's Prime Minister Lee Hsien Loong said: "The international order is at a turning point. The existing free, open and rules-based multilateral system which has underpinned ASEAN's growth and stability, has come under stress. Countries, including major powers, are resorting to unilateral actions and bilateral deals, and even explicitly repudiating multilateral approaches and institutions."

Unsurprisingly, global trade uncertainties was one of the key subjects discussed at the summit.

However, the main economic topic on the agenda was the Regional Economic Comprehensive Partnership (RCEP). Other than the ASEAN countries, this agreement brings together China, Japan South Korea and, also Australia, New Zealand and India.

If completed, the RCEP will be the largest such trade agreement since the General Agreements on Tariffs and Trade (GATT) which was implemented in 1948. It will encompass 25 per cent of global gross domestic product (GDP) of US$25 trillion, 45 per cent of the total population, 30 per cent of global income and 30 per cent of global trade. Many were expecting it to be wrapped up this year but at the summit it was announced that it will be delayed till 2019. Leaders at the summit, however, were quick to emphasise that negotiations are at its final stage.

The pact is seen as vital in securing the region's continued prosperity, especially after a trade war broke out between its vital trading partners, US and China.

Although Prime Minister Modi urged an early conclusion to RCEP talks, it is not clear at this stage what level of commitment India has in participating. The RCEP is a traditional trade pact which cuts tariffs on tradable goods whereas India's strength is in the services sector. India is believed to be holding up for better market access for its professionals and to the services sector than is currently offered.

India also complained that imports to India from ASEAN has grown faster than Indian exports to the bloc. New Delhi is reluctant to cut tariffs and open its markets in the face of strong opposition from its farming as well as steel and textiles industries. The dilemma facing India is exacerbated by the fact that strategic rival China is part of the agreement although China is an important trading partner as well.

On the other hand, ASEAN nations are increasingly investing in India, including in ports, highways, townships and food processing. It was noted at the summit that with the Modi government improving ease of doing business, investment and trade with ASEAN has grown. Despite good progress being made on the India-Myanmar-Thailand trilateral highway with an extension to Laos, Cambodia and Vietnam, ASEAN has called for better maritime, air, land and digital connectivity between ASEAN and India.

With the Indian general elections expected next year, the RCEP negotiations come at a sensitive time for PM Modi.

India is the sixth largest trading partner of ASEAN having signed the India-ASEAN FTA (free trade agreement) in 2010 and bilateral trade is valued at US$80 billion but this is seen by economists as far short of its true potential.

PM Lee of Singapore urged India to be part of RCEP saying: "Together with the ASEAN-India Free Trade Area, we hope that this will help us reach the ASEAN-India trade target of US$200 billion in total trade by 2022."

If India can address its national interests through the on-going talks, the RCEP is a promising vehicle that can help a reluctant India which traditionally shies away from trade pacts, expands its markets through incorporation into a truly open trading bloc.

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News Network
June 18,2020

Washington, Jun 18: US Defence officials are concerned over China's use of COVID-19 situation to gain stakes in strategically important companies of United States as the impact of novel coronavirus has left several companies in dire need of capital.

Amid the pandemic, it getting hard for the defence department to keep an eye on national security and help protect smaller companies down the chain, CNN reported.

"We are paying close attention to any indicators that China is leveraging Covid-19 to take advantage of a situation where defence companies need capital more than ever," a defence official told CNN.

In April, Ellen Lord, undersecretary of defence for acquisition and sustainment said it is paying close attention to 'adversaries' against the 'economic warfare' with the United States.

"We have to be very, very careful about the focused efforts some of our adversaries have to really undergo sort of economic warfare with us, which has been going on for some time," Ellen Lord, undersecretary of defence for acquisition and sustainment was quoted as saying by CNN.

US Committee on Foreign Investment protects its interest against hostile countries gaining ownership in strategically important companies. But the pandemic is changing the definition of national security concerns to include drugs, protective gear and medical supplies.

"These are now national security needs and we probably should have been thinking about it a long time ago in terms of biowarfare that we should have a trusted industrial base or a set of trusted allies -- the UK, or NATO allies or Japan or Korea -- who are trusted in that regard," Bill Greenwalt, a former Pentagon official.

Give the threat posed by foreign acquisition, Pentagon has been offering tools to help small US businesses defend themselves against adversarial investment and conducting background checks with other government agencies to ensure transparency.

US President Donald Trump's trade adviser Peter Navarro recently told CNN if Trump wins reelection, Washington DC will likely take offshore supply chains as national security priorities.

"If we fail to do that in the face of this crisis, we will have failed this country and all future generations of Americans," Navarro said.

The US State Department has also warned US allies to "avoid economic overreliance on China" and "guard their critical infrastructure" from China's influence.

Chad P Bown, a senior fellow at the Peterson Institute for International Economics, pointed to recent China's economic coercion of Australia on the political matter saying, "this is how China operates and everybody knows it."

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News Network
June 11,2020

Beijing, Jun 11: Floods and mudslides in south China have uprooted hundreds of thousands of people and left dozens dead or missing, state media reported Thursday.

The bad weather has wreaked havoc on popular tourist areas that had already been battered by months of travel restrictions during the coronavirus outbreak.

Torrential downpours unleashed floods and mudslides that caused nearly 230,000 people to be relocated and destroyed more than 1,300 houses, official state news agency Xinhua reported, citing the Ministry of Emergency Management.

In southern Guangxi Zhuang Autonomous Region, six people were reported dead and one missing, Xinhua said.

Streets were waterlogged in popular tourist destination Yangshuo, forcing residents and visitors to evacuate on bamboo rafts.

The local government said more than 1,000 hotels had been flooded and more than 30 tourist sites damaged.

One owner of a family-run hotel told Xinhua that the guest rooms were submerged in one metre (three feet) of rainwater.

The extreme weather has dealt a hefty blow to the region's tourism sector, which is still reeling from the COVID-19 epidemic.

The emergency management ministry said there were direct economic losses of over 4 billion yuan (more than $550 million) from the flooding, Xinhua reported.

In Hunan Province, at least 13 people were killed in rain-triggered disasters, and another eight people are missing or killed in southwestern Guizhou province, according to the local emergency response departments, Xinhua said.

The heavy downpours began at the beginning of June and have led to "dangerously high water levels" in 110 rivers, Xinhua reported.

Further rainstorms are expected in the next few days across the south.

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News Network
July 4,2020

Geneva, Jul 4: The World Health Organization has updated its account of the early stages of the COVID crisis to say it was alerted by its own office in China, and not by China itself, to the first pneumonia cases in Wuhan.

The UN health body has been accused by US President Donald Trump of failing to provide the information needed to stem the pandemic and of being complacent towards Beijing, charges it denies.

On April 9, WHO published an initial timeline of its communications, partly in response to criticism of its early response to the outbreak that has now claimed more than 521,000 lives worldwide.

In that chronology, WHO had said only that the Wuhan municipal health commission in the province of Hubei had on December 31 reported cases of pneumonia. The UN health agency did not however specify who had notified it.

WHO director Tedros Adhanom Ghebreyesus told a press conference on April 20 the first report had come from China, without specifying whether the report had been sent by Chinese authorities or another source.

But a new chronology, published this week by the Geneva-based institution, offers a more detailed version of events.

It indicates that it was the WHO office in China that on December 31 notified its regional point of contact of a case of "viral pneumonia" after having found a declaration for the media on a Wuhan health commission website on the issue.

The same day, WHO's epidemic information service picked up another news report transmitted by the international epidemiological surveillance network ProMed -- based in the United States -- about the same group of cases of pneumonia from unknown causes in Wuhan.

After which, WHO asked the Chinese authorities on two occasions, on January 1 and January 2, for information about these cases, which they provided on January 3.

WHO emergencies director Michael Ryan told a press conference on Friday that countries have 24-48 hours to officially verify an event and provide the agency with additional information about the nature or cause of an event.

Ryan added that the Chinese authorities immediately contacted WHO's as soon as the agency asked to verify the report.

US President Donald Trump has announced that his country, the main financial contributor to WHO, will cut its bridges with the institution, which he accuses of being too close to China and of having poorly managed the pandemic.

The WHO denies any complacency toward China.

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