Prof D Mukhopadhyay
The global economy is continuously evolving, with nations seeking new avenues for growth and economic cooperation. In this context, the Comprehensive Trans-Pacific Partnership (CPTPP) presents an exceptional opportunity for India. This write-up explores why India should join the CPTPP, and provides a comprehensive justification for this crucial decision. By joining the CPTPP, India could enhance market access and increase trade opportunities. The CPTPP, with its current member countries consisting of Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam, offers India a gateway to an expanded market and increased trade opportunities. According to the World Bank Report, 2021, the CPTPP member countries represent a significant portion of the global GDP and population. By joining the CPTPP, India gains access to a combined market size of approximately 500 million people, accounting for nearly 13% of global GDP. This extensive consumer base can significantly boost India’s exports and drive economic growth. And consequently, enlarge the international trade market size. Further,Tariff Reduction: The CPTPP eliminates or reduces tariffs on a wide range of goods and services.
According to the World Trade Organization (WTO), 2020, CPTPP members have agreed to remove approximately 98% of tariffs on trade among themselves. This reduction in trade barriers would enhance India’s competitiveness and make its products more affordable and accessible in the CPTPP markets and the same could have a significant positive impact on international market competitiveness if India goes for adoption of the modern scientific approach in cost management comprising of various strategic cost and management accounting tools and techniques for information generation and dissemination of the same among the tactical and strategic management of the enterprises both at domestic and global level. India has historically been reliant on a limited number of trade partners. Joining the CPTPP would enable India to diversify its export destinations and reduce its dependency on any single market. This diversification is crucial to mitigate risks and enhance the resilience of India’s economy. Besides, India’s participation in the CPTPP would make it an attractive destination for foreign direct investment (FDI) and facilitate the transfer of advanced technologies in several ways such, as easy Foreign Direct Investment(FDI) as the CPTPP member countries have a track record of attracting substantial FDI.
For instance, according to the report on the United Nations Conference on Trade and Development, 2021, the CPTPP participated countries received a combined total of over $600 billion in FDI in 2020 and India can tap into this investment potential, which would essentially accelerate her economic growth, create employment opportunities , and improve living standards of her people. It is worth mentioning that the CPTTP encourages technology transfer through its provisions on intellectual property rights (IPR) and investment protection. Collaborating with technologically advanced member countries, India can access cutting-edge research, innovation, and development. This would promote technological advancement across various sectors, enhancing India’s competitiveness, efficiency, consequently, productivity of the workforce. The CPTPP may act as a springboard for India for strengthening supply chains and economic integration.
India’s participation in the CPTPP would contribute to optimise economic gains in the regional supply chains and promote economic integration signifying, immense value in today’s interconnected global economy. It is important to cite the catastrophic experience in the COVID-19 pandemic that exposed vulnerabilities in global supply chains, emphasizing the need for greater resilience. By joining the CPPTP, India can participate in the diversification and regional supply chains. This is expected to mitigate risks associated with disruptions and enhance the country’s ability to respond to future challenges effectively. Moreover, the CPPTP aims at promoting closer economic integration among its member countries in order to foster seamless trade and investment flows, harmonizes regulations, and facilitates cooperation in areas such as customs procedures, standards, and trade facilitation. As India becomes part of this regional framework, it would benefit from streamlined procedures, reduced transaction costs, and increased efficiency in cross-border trade.The CPTPP upholds high standards in areas such as labor rights, environmental protection, and intellectual property. Joining the agreement would enable India to enhance the visibility of her domestic policies and practices in these crucial areas.
The CPTPP includes provisions for labor rights, promoting fair and ethical working conditions. By aligning with these standards, India can further improve its labor practices, ensuring the welfare and rights of its workers. This would contribute to sustainable and inclusive growth, fostering social harmony and paving the path of economic development to reach over the ultimate destination, 2047, when India looks forward to obtaining the tag of one of the economic superpowers . The CPTPP incorporates commitments to environmental protection and sustainable development. By joining the agreement, India would be encouraged to strengthen its environmental regulations, promote clean technologies, and address climate change concerns. This would not only benefit the environment but also enhance India’s global reputation as a responsible and sustainable nation.
As of now, India stands at a critical juncture, poised to make significant strides in its economic development. Participating in CPTPP would unlock a plethora of benefits, including enhanced market access, increased trade opportunities, attracting FDI, technological advancements, strengthening supply chains, promoting economic integration, and improving standards and practices. If India considers her option for seizing this opportunity, she can position herself as a global economic powerhouse, driving sustainable growth, creating employment for skilled, semi-skilled and even unskilled workforce with 360 degree inclusive economic well-being the Indian society at large.
India needs to counteract China and other economically advanced nations in order to achieve her set target to emerge as an economic powerhouse not only in South-East Asia but across the globe. India’s participation in the CPTPP would position it strategically to counteract the economic influence of China and other economically advanced nations within the agreement. The CPTPP is expected to provide India with a platform to compete directly with China and other economically advanced nations. India can tap into the vast consumer markets of CPTPP member countries and offer its competitive goods and services, which would enable India to challenge China’s dominance in certain sectors and establish herself as a formidable player in the region. The CPTPP would offer India an opportunity to diversify her trade partners beyond China. Over the years, India has faced trade imbalances and over-reliance on the Chinese market. By expanding her trade relations within the CPTPP, India can reduce her dependence on China and establish stronger economic ties with other member countries and this diversification would help India mitigate risks associated with any geopolitical or economic fluctuations in China. Besides, by joining the CPTPP, it would grant India access to advanced technologies and innovation ecosystems present in economically advanced member countries. This exposure would help India enhance her own technological capabilities and narrow the technology gap with China. By leveraging these technological advancements, India could boost her industrial sectors, improve productivity, and foster innovation-led economic growth.
Further, the CPTPP would enable India to forge closer regional cooperation and alliances with like-minded countries. By aligning with other member nations that share similar economic and geopolitical interests, India can collectively counterbalance the influence of China and other economically advanced nations within the reach of the CPTPP. Through collaborations on trade policies, investment flows, and regional initiatives, India can leverage the collective strength of the CPTPP to safeguard her economic and strategic interests. Moreover, the CPTPP would necessitate India to undertake crucial economic reforms to align with the high standards set by the agreement. This would require improvements in areas such as regulatory frameworks, ease of doing business, labor standards, and environmental practices. These reforms would not only enhance India’s competitiveness within the CPTPP but also strengthen her overall economic resilience and attractiveness as an investment destination.
India stands at a critical juncture, poised to make significant strides in her economic development and raise the living standards of her people. Joining the CPTPP would unlock a plethora of benefits, including enhanced market access, increased trade opportunities, attracting FDI, technological advancements, strengthening supply chains, promoting economic integration, and improving standards and practices. As India considers her options, she must take into consideration the trans-formative potential that the CPTPP offers. By seizing this opportunity, India can position itself as a global economic powerhouse, driving sustainable growth, creating jobs, and improving the well-being of its citizens.
In conclusion, it may be asserted that India’s entry into the Comprehensive Trans-Pacific Partnership (CPTPP) is likely to provide a significant opportunity to counteract China and other economically advanced nations. By leveraging the benefits of market competition, economic diversification, access to advanced technologies, intellectual property protection, regional cooperation, and economic reforms, India can position itself strategically and enhance her standing in the global economic landscape. Joining the CPTPP would enable India to strengthen her economic ties with a diverse set of countries, reduce its dependence on any single market, and foster sustainable and inclusive growth. By effectively countering the economic influence of China and other advanced nations, India can carve out her own path, leveraging her strengths, and contribute to the prosperity and stability of the region, and therefore, India should favourably consider joining the CPTPP without much delay.
( The author is a Bangalore-based Educationist and Management Scientist.)
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