India has decided to stay out of the Regional Comprehensive Economic Partnership (RCEP) and this has been reflected continuously on protecting domestic interests. India chose not to join the trade pact back in 2019 citing concerns didn’t align with the goals of government. Commerce and Industry Minister Piyush Goyal lately confirmed in Parliament that the stance remains same.
The RCEP aims to create a massive free trade zone among Asia-Pacific countries including China. India feared that it would lead to a flood of cheaper imports and therefore put pressure on local industries. The concern seems justified by looking at the numbers. The imports of India from China have surged to $101.74 billion in 2023-24 from $70.32 billion in 2018-19. Exports dipped marginally to $16.66 billion in the same period.
India chose to prioritize self-reliance instead of joining such a pact. It is a calculated move to protect the market and industries as well. However, the question remains with such trade imbalances whether India can continue to compete effectively without broader trade agreements.
On the brighter side, the startup ecosystem in India is showing incredible promise. As of October 31, 2024, startups have self-reported creating 16.67 lakh direct jobs across more than 55 sectors. IT services alone accounted for over 2 lakh of these jobs, followed by 1.47 lakh in healthcare and life sciences.
Startups are currently playing important in the economy of India. They are creating jobs amid struggles for the same in traditional sectors. Their growth boosts employment and also positions the country as a hub for innovation on the global stage.
The cautious approach to global trade agreements and emphasis on strengthening a strong startup ecosystem showcase dual strategy—guarding its economy and also building it from within.
