Prime Minister Narendra Modi on Monday confirmed that India will not participate in the third Regional Comprehensive Economic Partnership, or RCEP, trade bloc, NDTV reported. The RCEP is a free-trade agreement between 16 countries across the Asia-Pacific region that aims to reduce tariffs and duties between member countries so that goods and services can flow freely between them. It will become the world’s largest trade bloc when created.

Modi, who addressed the RCEP Summit in Thailand’s Capital Bangkok, said the current agreement “does not fully reflect the basic spirit and the agreed guiding principles” or India’s concerns. “When I measure the RCEP Agreement with respect to the interests of all Indians, I do not get a positive answer,” he said. “Therefore, neither the talisman of Gandhiji nor my own conscience permits me to join the RCEP”.

Modi said the decision was taken in order to protect workers and farmers of the country, reported Hindustan Times. India has been raising the matter of market access and tariffs amid concerns that the country may be flooded with cheap Chinese agricultural and industrial products once the deal is signed.

“India stands for greater regional integration as well as for freer trade and adherence to a rule-based international order,” the prime minister added, according to PTI. “India has been pro-actively, constructively and meaningfully engaged in the RCEP negotiations since inception. India has worked for the cherished objective of striking balance, in the spirit of give and take.”

The leaders of other nations that participated in the talks are expected to announce the conclusion of seven years of negotiations. “Today, when we look around we see during seven years of RCEP negotiations, many things, including the global economic and trade scenarios have changed,” said Modi. “We cannot overlook these changes.”

The impetus to complete the deal has come from a trade war between the United States and China, which has affected regional growth, but India fears a potential flood of Chinese imports after the import barriers are demolished.

The RCEP was first proposed in 2011 by the 10-member Association of South East Asian Countries, which has been behind the 28 rounds of negotiations since then. Thailand, which is the current ASEAN chairperson, has been particularly keen to close the negotiations.

Earlier in the day, Congress leader Rahul Gandhi said the proposed free trade deal will flood the country with cheap goods and result in the loss of millions of jobs.

India is under an intense economic slowdown. The output of eight core sectors of the Indian industry – coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity – declined by 5.2% in September.

Also read: Why Modi government is wary of joining the world’s largest trading bloc

Modi’s meeting with Shinzo Abe

Earlier on Monday, Prime Minister Narendra Modi met his Japanese counterpart Shinzo Abe on the sidelines of the East Asia Summit. The two leaders reviewed the evolving security scenario in the Indo-Pacific region and economic engagement between the two countries.

“The leaders welcomed that the inaugural 2+2 Foreign and Defence Ministerial Dialogue will take place later this month in India,” said the Ministry of External Affairs. “They agreed that the dialogue will help provide impetus to the bilateral security and defence cooperation between the two sides.”

They also reviewed the progress on Mumbai-Ahmedabad High Speed Rail project and reaffirmed their commitment to advance mutual efforts to facilitate the smooth implementation of the project.

The prime minister congratulated his counterpart on the recent coronation of Japanese Emperor Naruhito, and Abe recalled the participation of President Ram Nath Kovind in the ceremony.

On Sunday, Modi had met Myanmar’s State Counsellor Aung San Suu Kyi. The prime minister told her that stable and peaceful border was an “important anchor” for the continued expansion of bilateral partnership. “Prime minister emphasised the value India attaches to Myanmar’s cooperation in ensuring that insurgent groups do not find space to operate across the India-Myanmar border,” the external affairs ministry said.

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