The 12-nation Trans Pacific Partnership (TPP) led by the US is unlikely to have a significant impact on India’s trade, but the mega trade deal could have an adverse bearing on India’s textiles and clothing businesses, according to a Government think tank Centre for WTO Studies which analysed the TPP with reference to India. “We may not be impacted that much. We may lose a bit on textiles and clothing,” a newspaper quoted Abhijit Das, Head of Centre for WTO Studies as saying. Vietnam, which is part of this trade pact, is a competitor of India in textiles sector in the American market. TPP is billed as the largest regional trade pact. According to the study, although TPP may not offer India much gain in terms of rise in its exports and would have very limited trade diversion, it does offer huge investment opportunities for India. The TPP trading bloc will also provide India with opportunities for developing its own global value chains with Indian lead firms. The study concluded that remaining out of TPP trading bloc can benefit India more than joining it. The trade diversion is not substantial but joining TPP may lead to a much higher rise in imports as compared to exports. The investment potential and opportunities become more viable by remaining outside TPP. Further, India can continue to enjoy the policy space it has with respect to many of the restrictive provisions of TPP.
