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TWN Info Service on WTO and Trade Issues (Apr16/14)
26 April 2016
Third World Network

Indian CSOs voice concerns over negative impact of RCEP
Published in SUNS #8227 dated 22 April 2016

Geneva, 21 Apr (Kanaga Raja) - A network of over 80 civil society organisations in India has raised concerns over the possible negative impact that the Regional Comprehensive Economic Partnership (RCEP) will have on issues ranging from access to medicines, tax policy, investor rights to farmers' access to seeds.

These concerns were highlighted by the Forum Against FTAs, a network of civil society organisations, trade unions and peoples' movements in India, and come on the eve of the 12th round of RCEP negotiations taking place in Perth, Australia from 22 April onwards.

The Regional Comprehensive Economic Partnership has been under negotiation since 2012 and involves sixteen governments in the Asia and Pacific region: the ten ASEAN countries together with Australia, China, Japan, Korea, New Zealand and India.

This mega-regional free trade agreement (FTA) is expected to be concluded later this year.

In a press release issued in New Delhi, the Forum Against FTAs believes that India can stay strong and re-think its strategy for RCEP, while staying away from Trans-Pacific Partnership (TPP)-like agreements.

"The Government of India must not give in to any pressures, whether for tariff reduction or on any other front. Any attempts to isolate India, as in the WTO, to simply push for more trade will have grave consequences for sustainable futures of peoples not only in India, but also in the region," it said.

According to the CSOs, the RCEP once concluded will be the world's largest trading bloc, with its own set of rules on a broad spectrum of issues such as trade in goods, agriculture, services, investment, competition, intellectual property (IP) and other areas of economic and technical cooperation.

"Thus, the extent of its coverage both in terms of the range of substantive issues and the number of peoples whose lives and livelihoods it impacts is unprecedented."

According to the press release, a major cause of concern for civil society across the region has been the lack of public disclosure on what exactly is on the agenda for Round 12 of the RCEP negotiations.

It was critical that all participating member countries do provide a full disclosure of their positions and relevant documents are shared with affected constituencies.

Further, negotiators should brief civil society and not just industry groups prior to and after the talks.

There is a long-standing demand for transparency in treaty negotiations, said the CSOs, noting that in Europe too, the Dutch people are mobilising for a referendum on another controversial FTA between the European Union and the United States - the Trans-Atlantic Trade and Investment Partnership (TTIP).

"India has shown the way in terms of the production and availability of high quality, safe and effective drugs at affordable prices and is therefore often called the 'pharmacy of the world'. This is because India has tuned its patent law to facilitate this," said the CSOs.

The press release quoted former UN Special Rapporteur on the Right to Health Mr Anand Grover, who is now with the Lawyers Collective, as saying that the flexibilities employed in Indian Patent Law - Section 3(d), compulsory licenses etc. are sought to be done away with by TRIPS-plus provisions in the RCEP.

"Doing so will make drugs unavailable and unaffordable to not just the poorest of patients but also to middle and upper middle class patients, not only in India but also other developed and developing nations. India must stand firm to ensure RCEP provisions do not agree to TRIPS+ and/or TPP provisions," he said.

According to the Forum Against FTAs, another controversial issue is whether the secretive investor-State dispute settlement (ISDS) mechanism is still on the table in the RCEP negotiations.

Research shows that corporations are regularly using ISDS courts to avoid paying their legitimate taxes.

"Corporations have sued countries ranging from India to Romania in over 40 tax-related disputes and, in some instances, have successfully challenged and lowered their tax bills."

V. Lakshmi, Regional Secretary for Asia and Pacific of Public Services International (PSI), a global trade union, underlined that corporate tax evasion is now a serious public concern worldwide.

Tax breaks cost developing countries as much as $138 billion a year, money that is much needed for healthcare and other critical public services.

For instance, Vodafone launched an arbitration claim against India that is still ongoing, after the former was ordered to pay tax on an $11 billion deal when it acquired a controlling interest in Hutch-Essar, an Indian phone company.

Vodafone had paid no capital gains tax on the 2007 deal through its use of offshore companies.

According to Lakshmi, this is not an isolated case and trade deals will make it a systemic issue.

The fact that multinational companies would be able to challenge and undermine fair tax systems under RCEP is testament to the terrifying extent of the corporate grab embedded in this toxic trade deal, Lakshmi emphasised.

The press release noted that thus far the Government of India is holding strong against demands from developed countries, such as Japan and Korea, which want higher levels of IP protection in line with UPOV 1991.

"This would mean going against India's domestic legislation - Protection of Plant Varieties and Farmers' Rights Act, 2001, that expressly provides for farmers' freedoms over their own seeds," it said.

The key concerns of small farmers and seed savers are the availability of their own seeds and the continuance of their seed freedoms.

"Since, most of them are women, this also has a gender implication, whereby their knowledge about locally adaptive varieties that is even more relevant with the climate crisis and frequent droughts, is further marginalised."

The CSOs further noted that 'biopiracy' of local know-how and bio-resources has and continues to be matter of concern for India, and that for that reason it is insisting on other trading partners in RCEP to provide adequate traditional knowledge protection.

All the RCEP countries are also members of the multilateral environmental agreement, the Convention on Biological Diversity (CBD), which requires them to do so, they said.

"If the RCEP is meant to be Asia's counter to the other FTAs such as the TPP - Trans-Pacific Partnership Agreement - then it must be truly responsive to Asia's realities," the CSOs concluded.


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