How RCEP negotiations hinge on a single phrase

A major Asian trading agreement scheduled to be completed by the year-end could be hanging on a single phrase, as India treads a fine line between an external pressure to complete negotiations and internal desire to continue talks until next year.

As the East Asia summit nears this week, negotiations for the RCEP (Regional Comprehensive Economic Partnership) are going down to the wire. With the next ministerial scheduled for November 13, PM Modi, who will have to take the final decision on India’s negotiating stance, is involving himself more deeply, spending long hours with the Indian negotiators. Negotiators are holding last-minute discussions this weekend, working to a ministerial meeting on Monday, to be followed by the RCEP summit on Wednesday.

The most recent hiccup in the talks is the phrase “substantial conclusion”. In the previous round of discussions in September, the countries had agreed to announce that they would declare that they had reached a “substantial conclusion” while continuing to fine-tune the negotiations before reaching a final agreement by 2019.


During the talks in Auckland last week, it quickly became clear that in certain countries like Malaysia, the phrase “substantial conclusion” had legal implications, which required the government to make the agreement details public to Parliament and media. With elections due next year (in India, Indonesia, Thailand and Australia), the Modi government would like to ideally reveal the details after the polls, for fear of unintended consequences.

Sources said Modi had directed that India should strive to stay in the deal. The RCEP is actually a trade agreement that covers almost all of the Indo-Pacific, a key focus of Indian foreign policy at this point. In addition, opening up these markets for Indian services, and goods, is equally important. Many countries want India to be part of this deal as a way of balancing China’s outsized presence.

• The agreement: The Regional Comprehensive Economic Partnership (RCEP) is a proposed free trade agreement between 16 countries: ten of the Association of Southeast Asian Nations (ASEAN) and the six Asia-Pacific countries with which they have existing free trade agreements (Australia, China, India, Japan, South Korea and New Zealand).
• India’s stake: It covers almost all of Indo-Pacific, a key focus of Indian foreign policy and is in the sixth year of negotiations. India was initially fearful of letting the RCEP become a backdoor for Chinese entry into India but it has now evolved its position to believe it has a lot to gain from the agreement. Many countries want India to be part of this deal as a way of balancing China’s outsized presence. The next RCEP ministerial meeting is November 13.
• The phrase: The most recent hiccup in the talks is the phrase “substantial conclusion”. In the previous round of discussions in September, the countries had agreed to announce that they would declare that they had reached a “substantial conclusion” while continuing to finetune the negotiations before reaching a final agreement by 2019.
• Problem & solution: In certain countries like Malaysia, the phrase “substantial conclusion” has legal implications, which requires the government to make the agreement details public to Parliament and media. With elections due next year (in India and Australia), the government would like to ideally reveal the details after the polls, for fear of unintended consequences. India has proposed using the term “substantial progress” at the next meeting to describe the state of the negotiations.