KL hopes spat with Delhi will not derail signing of RCEP

KUALA LUMPUR • Malaysia is working to resolve a spat with India over Prime Minister Mahathir Mohamad's stance on Kashmir, and hoping that a 16-nation trade pact, which includes India, will be signed this year despite the strained ties, its trade minister said.

Bilateral relations suffered a downturn after Tun Dr Mahathir told the UN General Assembly late last month that India had "invaded and occupied" Kashmir, a disputed Muslim-majority region also claimed by Pakistan.

India revoked the autonomous status of its Jammu and Kashmir state on Aug 5, and has rejected foreign criticism, largely from Muslim-majority countries and China, over the decision, insisting it is an internal affair.

Indian traders have called for a boycott of Malaysian palm oil - which Dr Mahathir has said amounts to a trade war - and there were concerns in New Delhi that negotiations on the Regional Comprehensive Economic Partnership (RCEP) could be affected too.

The spat between the world's second biggest producer and exporter of palm oil, and its biggest customer could most likely benefit Indonesia, the biggest producer and exporter of the commodity.

Malaysia's Minister of International Trade and Industry Darell Leiking told reporters yesterday that RCEP talks were on track, and a final deal should include all the intended participants - the 10 members of Asean and six Asia-Pacific countries, namely China, India, Japan, South Korea, Australia and New Zealand.

A RCEP summit will be held in Bangkok on Nov 4.

Mr Leiking said "anything can happen" before the summit, but all 16 countries were moving towards finalising the free trade agreement.

"We hope that RCEP negotiations can be concluded by year-end so that Malaysian companies could reap the opportunities from this mega free trade agreement in opening up more market access for our products and services," he said.

The RCEP is expected to create an integrated market of 3.4 billion people, with a combined GDP of US$49.5 trillion (S$67.5 trillion) or about 39 per cent of the world economy.

Mr Leiking also said he met Indian Trade Minister Piyush Goyal recently, and they informally discussed New Delhi's concerns on bilateral ties.


"Hope to meet him more and get more details into the issue and what they want to do," Mr Leiking said.

"We have yet to hear (formally) from the government. But we will engage with their government more so."

Separately, the Malaysian minister in charge of palm oil yesterday said the government was considering sending a delegation to meet India's top vegetable oil trade body, which had called on members to boycott Malaysian palm oil.

"We need to see the response on the India side," Primary Industries Minister Teresa Kok told reporters in Parliament, adding: "It's good to talk and it's good to not do harm to bilateral trade."


A version of this article appeared in the print edition of The Straits Times on October 25, 2019, with the headline 'KL hopes spat with Delhi will not derail signing of RCEP'. Print Edition | Subscribe