India Exits RCEP: Analysing Trade Flows under India’s CEPAs

By Biswajit Dhar | Briefing Paper # 31 | December 23, 2019

In November 2019, the Indian government took an unprecedented decision to withdraw from the Regional Comprehensive Economic Partnership (RCEP), which was to be the world’s largest economic integration agreement comprising 16 East Asian economies. The decision to withdraw came after almost all major domestic entities in both agriculture and manufacturing argued that the steep reductions in tariffs that were one of the main planks of RCEP would be detrimental to their interests.

This view of the domestic entities, which was eventually accepted by the government, exposed their lack of competitiveness…

India Exits the RCEP: What Happens Next?

By Kavaljit Singh | Briefing Paper # 30 | November 6, 2019

On November 4, India announced its decision to exit the negotiations on the proposed Regional Comprehensive Economic Partnership (RCEP) – a mega-regional free trade agreement. Prime Minister Narendra Modi conveyed the decision at the third RCEP Summit that took place in Bangkok. The summit was attended by the leaders of all 16 RCEP Participating Countries (RPCs).

The full text of PM Modi’s address at the RCEP Summit is not yet available, but according to a tweet by Prasar Bharati (India’s official broadcaster), Mr. Modi stated: “The present form of the…

India and Regional Comprehensive Economic Partnership: Key Issues and Implications

By Biswajit Dhar | Briefing Paper # 29 | October 11, 2019

The Regional Comprehensive Economic Partnership (RCEP) is a proposed mega-regional trade pact being negotiated between ASEAN and their six FTA partner-countries (India, Australia, China, Japan, South Korea, and New Zealand) since 2012. It covers a wide range of issues, including trade in goods, trade in services, investment, intellectual property rights, competition policy, dispute settlement, and economic and technical cooperation.

This briefing paper begins by summarizing the negotiating mandate of the RCEP and shows how major participating countries have pushed the negotiations towards deeper economic integration, influenced by their simultaneous engagements…

Argentina Returns to Capital Controls

By Kavaljit Singh | Briefing Paper # 28 | September 4, 2019

On September 1, the Argentine government led by President Mauricio Macri imposed capital controls in a bid to stem the fall in the foreign exchange reserves and the peso currency. This unexpected move was initiated soon after the authorities spent nearly $3 billion of forex reserves to repay short-term debt and to protect the value of the peso.

The announcement followed the Macri government’s unilateral decision taken on August 28 to delay repayment of short-term debt instruments (denominated in both US dollar and peso) to maintain liquidity in the financial…

India’s Shadow Banking Crisis is Intensifying

By Kavaljit Singh | Briefing Paper # 27 | August 28, 2019

The ongoing liquidity crisis in India’s shadow banking sector is intensifying. The troubles that started with defaults by Infrastructure Leasing & Financial Services Limited (IL&FS) last year are far from over as the sector continues to face a severe liquidity crisis. If tight liquidity conditions persist over the next three quarters, it may turn into a solvency issue for several shadow banks.

After the IL&FS collapse, the entire sector is facing a crisis of confidence as investors are shying away from investing in securities issued by shadow banks. Several shadow…