The rules of origin clause will determine the fate of the Regional Comprehensive Economic Partnership (RCEP). This provision determines the country of origin and in turn the economic nationality of goods.

Deliberations during this phase could be chaotic for three reasons. In the present global value chain, no good is entirely produced or manufactured in any single country. Second, neither the country of origin nor production is defined. Last, China desperately needs access to Indian markets more than the other way round. And India is offering very few concessional tariff lines to China to prevent any onslaught of Chinese duty-free goods. China may set up manufacturing and assembly plants in Asean countries to exploit the China-Asean compensatory tariffs (for raw materials and intermediate goods). It may then make the most of Asean-India concessions (finished products) under the RCEP umbrella. The RCEP region will get access to Indian markets irrespective of which RCEP country exports to India. If electronic goods from China, after retail packaging in Vietnam, get imported to India, it can rightfully claim zero-duty offered to Asean, even though no such concession is offered to China.

The argument that substantial reduction in tariffs pertains only to Asean countries -- and not China -- appears farcical in this context.