The Straits Times says

New regional pact a nod to open trade

The dawn of a new trade pact in the world's most dynamic region reflects the triumph of leadership over drift, and is something to celebrate at a time when tit-for-tat tariffs have thrown sand in the gears of commerce. The collective decision of the 10 members of Asean and five of their trading partners - China, Japan, South Korea, Australia and New Zealand - to sign the Regional Comprehensive Economic Partnership (RCEP) deal next year is also a vote of confidence in the rules-based trading order that has been rent asunder by unilateral actions. Congratulations are in order, too, for the Asean way which nurtured the ambitious idea conceived in 2011, steered the arduous negotiations and managed to deliver the best possible version of the pact at the end of the 35th Asean Summit in Bangkok on Monday. Once perceived as a countervailing force to what was to be a United States-led Trans Pacific Partnership (TPP), the new trade pact now on the block represents a logical path for Asia's economic integration.

India's absence in the pact rankles. But New Delhi has been accorded the room to join the grouping when Prime Minister Narendra Modi judges that the benefits of belonging to the world's largest trading pact outweigh the costs. The gains include market access, which will prove increasingly valuable as exports become a more important component of the growing Indian economy, and a chance for India to forge its own supply chains in the region. Inevitably, as the Indian economy moves towards deeper reforms, the appeal of RCEP is bound to grow.

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A version of this article appeared in the print edition of The Straits Times on November 06, 2019, with the headline 'New regional pact a nod to open trade'. Subscribe