 "There's no significant opposition to India's membership to APEC: Kevin Rudd")
Kevin Rudd, former prime minister of Australia and president of Asia Society Policy Institute, a New York-based think-tank, has been championing the cause of India joining Asia-Pacific Economic Cooperation (APEC). In a recent visit to India, Rudd explains to Sudipto Dey why it is important for India and the US to resolve pending concerns around India's membership at the earliest, before the next APEC Summit at Lima in November this year. Edited excerpts:
What are the key concerns of APEC members about giving membership to India?
My position is that India's membership in APEC is overdue by 25 years. APEC was established 25 years ago, and India should have been a member from the beginning. That is a matter of history. My concern is about the future. My understanding is that not one among the APEC member states has any fundamental objection to India becoming a member.
There is another point that goes to the essence of APEC's arrangements. I don't think it is a credible argument that India could slow down, impede or undermine the normal work of APEC. That is, the timetable for implementation of any collective APEC resolution on tariff regulations or any regulatory reforms behind tariff wars lies with each individual member state. They have the flexibility to pursue the timetable of their choosing. If you look at economic development of each of the APEC states, there is difference between Canada, China, Chile, or Vietnam. So, each member is proceeding at its own pace.
Would you suggest any confidence-building measures for India to bridge the gap in perceptions?
These are matters that need to be resolved between New Delhi and Washington. I would strongly encourage both sides to resolve any outstanding impediments. Look at the upcoming APEC Summit in November at Lima in Peru. The question of future membership could well come up because of the issue around Columbian accession (to APEC). Then there is the question of democratic Burma (Myanmar), and how that government wants to fully integrate with economies of the region. If the membership question opens up (at Lima), I hope the pending issues before New Delhi and Washington get resolved before that.
Do you see any role for businesses, both from India and the US, in this?
I will encourage the Confederation of Indian Industry, which has been our collaborators in the Asia Society Policy Institute, on joint task force on India's APEC membership, to enter into a debate here. I would encourage US-India Business Council and the APEC Business Council to speak to the business constituency. When APEC Summits are held, they bring CEOs (and business leaders) from a remarkable range of corporations, from all 21 member states. It is not just a gathering of government and policy decision-makers. An APEC Summit is always accompanied by an APEC Business Summit, which is network of thousands of significant business leaders from the Asia-Pacific region. Those networks open up further opportunities.
If there is any serious concern in domestic debates about India missing out on access to global value chains (GVCs), then APEC undertakes considerable technical work with member states and member economies, on those very issues. They ensure members are fully integrated to GVCs. Among the most integrated GVCs, the top 10 are APEC members.
What India does in formal trade negotiations, with Regional Comprehensive Economic Partnership (RCEP), Trans-Pacific Partnership (TPP) or the board of the World Trade Organization negotiations, is a matter for India (to decide). In fact, all the TPP members are APEC members. If India wants to go further in regional trade arrangements, APEC is the common underpinning to all the negotiating parties - RCEP, TPP, and in the future, for Free Trade Area of the Asia Pacific as well. That is phase II. Phase I for India is APEC itself.
How do you assess the political implications of the Panama Papers leak?
All countries benefit from transparency. I support the Indian government's approach to dealing with challenge of corruption in the country. Transparency is a challenge for everybody - developing and developed countries alike. If maximum transparency and maximum competitive neutrality compete on the basis of their merits, you have a high quality product with a competitive price. That's where market economies work. What are the enemies of market economy? Anti-competitive conduct and corruption. By opening our economies more and more, we reduce the likelihood of massive distortions and abuse of such distortions.
What are the key concerns of APEC members about giving membership to India?
My position is that India's membership in APEC is overdue by 25 years. APEC was established 25 years ago, and India should have been a member from the beginning. That is a matter of history. My concern is about the future. My understanding is that not one among the APEC member states has any fundamental objection to India becoming a member.
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I think there is a concern with the US, which prefers to see a more activist Indian position on regional and global trade liberalisation, than what it has seen in the past. The American concern is that India might slow down the APEC process, if it becomes a full member. I deeply disagree with that. Among other reasons, we have not applied such pre-conditions on other countries that have sought to become members of APEC. Secondly, if we are concerned on pan-regional level about India's economic and trade future, then we should deploy APEC to encourage India to move towards that direction.
There is another point that goes to the essence of APEC's arrangements. I don't think it is a credible argument that India could slow down, impede or undermine the normal work of APEC. That is, the timetable for implementation of any collective APEC resolution on tariff regulations or any regulatory reforms behind tariff wars lies with each individual member state. They have the flexibility to pursue the timetable of their choosing. If you look at economic development of each of the APEC states, there is difference between Canada, China, Chile, or Vietnam. So, each member is proceeding at its own pace.
Would you suggest any confidence-building measures for India to bridge the gap in perceptions?
These are matters that need to be resolved between New Delhi and Washington. I would strongly encourage both sides to resolve any outstanding impediments. Look at the upcoming APEC Summit in November at Lima in Peru. The question of future membership could well come up because of the issue around Columbian accession (to APEC). Then there is the question of democratic Burma (Myanmar), and how that government wants to fully integrate with economies of the region. If the membership question opens up (at Lima), I hope the pending issues before New Delhi and Washington get resolved before that.
Do you see any role for businesses, both from India and the US, in this?
I will encourage the Confederation of Indian Industry, which has been our collaborators in the Asia Society Policy Institute, on joint task force on India's APEC membership, to enter into a debate here. I would encourage US-India Business Council and the APEC Business Council to speak to the business constituency. When APEC Summits are held, they bring CEOs (and business leaders) from a remarkable range of corporations, from all 21 member states. It is not just a gathering of government and policy decision-makers. An APEC Summit is always accompanied by an APEC Business Summit, which is network of thousands of significant business leaders from the Asia-Pacific region. Those networks open up further opportunities.
If there is any serious concern in domestic debates about India missing out on access to global value chains (GVCs), then APEC undertakes considerable technical work with member states and member economies, on those very issues. They ensure members are fully integrated to GVCs. Among the most integrated GVCs, the top 10 are APEC members.
What India does in formal trade negotiations, with Regional Comprehensive Economic Partnership (RCEP), Trans-Pacific Partnership (TPP) or the board of the World Trade Organization negotiations, is a matter for India (to decide). In fact, all the TPP members are APEC members. If India wants to go further in regional trade arrangements, APEC is the common underpinning to all the negotiating parties - RCEP, TPP, and in the future, for Free Trade Area of the Asia Pacific as well. That is phase II. Phase I for India is APEC itself.
How do you assess the political implications of the Panama Papers leak?
All countries benefit from transparency. I support the Indian government's approach to dealing with challenge of corruption in the country. Transparency is a challenge for everybody - developing and developed countries alike. If maximum transparency and maximum competitive neutrality compete on the basis of their merits, you have a high quality product with a competitive price. That's where market economies work. What are the enemies of market economy? Anti-competitive conduct and corruption. By opening our economies more and more, we reduce the likelihood of massive distortions and abuse of such distortions.