India should follow the lead of the United Kingdom and seriously consider joining the Trans-Pacific Partnership (TPP).
The Partnership was the 12-nation trading bloc that U.S. President Donald J. Trump pulled out of last year. The idea behind the TPP was to create a bloc of Asian and American countries to counter China. Currently, 11 nations; Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile, and Peru, are participating in the Partnership.
Another large economy the United Kingdom is exploring the possibility of joining the TPP, The Guardian reported. The British Department of International Trade believes the Partnership can help the UK make up for trade lost after the Brexit pull-out from the European Union.
Joining the TPP would give India Access to vast amounts of Resources
British membership would transform the TPP from a Pacific-focused organization to a global trading bloc. It would also pave the way for other large economies like Brazil and Saudi Arabia to enter the partnership. An obvious use of this trading bloc would be to counter China’s growing influence or a developing Chinese-American economic alliance.
Indian membership in the TPP would be a next logical step because it would give India access to all the economies in the Partnership. That includes one of the world’s top 10 oil producers – Canada.
It would also provide India access to some of the world’s largest producers of vital minerals. TPP member Chile is one of the world’s largest producers of copper, while Australia is a major source of both iron ore and coal.
If Britain were to join the TPP, membership in it would give India access to the financial markets in the City of London. Not to mention British markets for Indian products.
Historically-minded people will note this sounds a great deal like the British Empire trading bloc the UK tried to create before World War II. A key difference with the TPP is that India would be the dominant member because it would be the largest nation participating.
Britain would not be able to dominate the TPP the way it did the Empire, because its military power is vastly reduced. Other TPP members might welcome India, as a counterweight to the UK and a replacement for lost American markets.
Membership in the TPP might be Vital to India’s Future
Membership in a global trading bloc like the TPP might be vital to India’s future because of the changing face of international commerce.
A danger to India and other countries would be the development of a Chinese-American trading bloc that would completely dominate international commerce. Such a bloc would be a great deal for American and Chinese companies, but bad for everybody else.
The sheer volume of their trade would put the USA and the People’s Republic would in a position to set the prices for a wide variety of goods and commodities. Since, the United States and China, are primarily manufacturing countries they would set the price for natural resources as low as possible to maximize their profits. This would doom nations dependent on natural resources exports to poverty.
There is an opportunity for India here as an alternative market for those natural resources and as an alternative source of manufactured goods. Participation in the TPP; or a similar organization, can help Indian industry by guaranteeing markets for products such as textiles, automobiles, and electronics.
It would also provide an alternative to a Beijing-Washington axis that will try to make the world into a playground for American and Chinese corporations. Such a trading bloc may not be Trump’s goal, but it seems to be Chinese President Xi Jinping’s end game. Forestalling, such an alliance must be a prime goal of Indian foreign policy.
Like the United Kingdom, India has a unique opportunity to develop new trade arrangements that can greatly enhance its economy. Hopefully, Prime Minster Narendra Modi will take advantage of that opportunity.