India is wary of Chinese presence in the proposed Regional Comprehensive Economic Partnership (RCEP). India does not want to cede space to China in the global textile and clothing sector. While the ongoing US-China trade war presents an opportunity to Indian textile manufacturers to enhance their exports to the US, India must tread cautiously, particularly with China, as half of India’s textile and clothing trade in the RCEP is with China.

China is already re-routing its textiles into India through Bangladesh, Sri Lanka etc. India’s trade deficit with China in the textile and clothing sector is likely to be widened once RCEP is concluded and could be detrimental for its domestic textile manufacturers.

RCEP comprises 10 Asean members and their six free trade partners - India, China, Japan, South Korea, Australia and New Zealand. Asean members comprise Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam. The RCEP negotiations aims at covering goods, services, investments, economic and technical cooperation, competition and intellectual property rights. Member countries are looking to conclude the talks by the end of this year, but many issues, including the number of products over which duties will be eliminated, are yet to be finalised.