Political and Economic Notes:
R.C.E.P. Trade Deal
Surrender of National Interests
India and other 15 countries
are in the final phase of
negotiations on Regional Compre-
hensive Economic Participation
held in Vietnam. According to the
news reports, India has agreed to
several provisions that bring it in
line with investment rules, including
banning host countries from
mandating
that
investing
companies transfer technology and
training to their domestic partners
and removing the cap on the
quantum of royalties domestic
companies can pay to their foreign
partners.
As ‘The Hindu’ reported, “the
investment chapter of RCEP deal
has been agree upon and India has
agreed to the removal of
technology transfer requirements
and also the removal of any caps
on Royalty payments”, the source
said. India also agreed to reduce
tariffs on the imports of milk and
milk products.
Until now the Indian
government is claiming that it is
pursuing a hard policy at
negotiations on the issues
detrimental to India’s interests that
includes technology transfer and
royalty payments. As any
international deal need not be
endorsed by the Indian Parliament,
the government may sign it as it
likes. The news leakages to the
media are only calculated move to
prepare the ground back in the
country.
If signed, the RCEP deal
would spell doom to millions of
peasants in India by destroying
their livelihoods and by land
grabbing.
Land is a basic necessity in
agriculture. Land grabbing by
October - 2019
foreign investors and agribusiness
deprives and compromises the
lives and livelihoods of small
farmers
and
indigenous
communities. At the same time,
land concentration tends to make
countries more vulnerable to
fluctuating food prices, speculation
and the need for imports.
Among RCEP member
countries, over 9.6 million hectares
of farmland have already been
transferred from rural communities
to foreign corporations over the
last decade.[2]The largest
transfers happened in Australia,
Cambodia, Indonesia and Laos.
Companies
such
as
the
Singapore-based Wilmar and
Olam, the South Korean
conglomerate Daewoo or the
Chinese agriculture company
Beidahuang Group are among
those that have acquired hundreds
of thousands of hectares of
farmland concessions across the
RCEP region.
Since RCEP talks began in
2012, the rise of e-commerce and
information technologies became
prominent that are attracting new
corporations into farmland
investing among RCEP member
countries. China’s e-commerce
giant Alibaba has reportedly
acquired 29 dairy farms in New
Zealand totaling 12,000 hectares.
The RCEP trade deal has the
potential to exacerbate and
escalate this trend of land
grabbing. The RCEP proposes
rules that will facilitate the transfer
of lands from peasants to big
agribusiness. These provisions are
found in two chapters: the
investment chapter and the
services chapter. Both oblige
governments to remove barriers to
foreign investment, including in
agriculture and in service.
One major rule is called
‘national treatment’. Under
RCEP, every country must treat the
multinational corporations of other
RCEP countries as if they were
domestic companies. That means
that, unless they make special
exceptions when they sign the text,
countries like India, Indonesia, the
Philippines and Thailand which
currently restrict foreigners’ ability
to own farmland will no longer be
able to do so. This applies also to
food retailers and financial
institutions investing in them. In
short, RCEP countries will have to
open land markets.
Both chapters also contain
‘standstill’ and ‘ratchet’ clauses.
That means that governments
have to freeze their current levels
of market opening, and if they
liberalise more they cannot go
back. In the past decade, RCEP
countries like Laos and Japan have
adopted a raft of legislative
changes to remove protections on
farmland that small farmers and
indigenous communities tradi-
tionally enjoyed, exposing them to
the takeover of their lands for
large-scale corporate farming.
If the RCEP agreement is
signed by India, most immediate
impact would be on the dairy
sector. India’s 150 million small
dairy farmers, local cooperatives
and networks of small-scale
vendors have made the country
the world’s largest producer of milk.
The handful of MNCs that dominate
the global dairy industry are still
only marginal players in India, and
only a tiny fraction of dairy products
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