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There were several caveats in RCEP that were huge red flags domestically. For example , Diary & associated products from NZ to India , Chinese goods getting re-

There were several caveats in RCEP that were huge red flags domestically. For example , Diary & associated products from NZ to India , Chinese goods getting re-routed through Vietnam (Manufacture a shoe in China , just label it in Vietnam and route to India) etc. that were a problem. It is worrying that Chinese influence is grappling ASEAN economies , most times it is the worry that they won't play fair with smaller trade partners. For once , a lot of people were happy in my state the agreement was not signed.

nl 6y ago
> huge red flags domestically Probably useful to specify what country you are in. > Diary[sic] & associated products from NZ to India NZ dairy is generally considered high quality and good cost, so it is unclear what the problem is here > Chinese goods getting re-routed through Vietnam People say this like customs enforcement agencies don't know about this. In some cases this is acceptable, but it depends on the exact trade rules about the amount of local content that needs to be added in a country.
- cocoland2 6y ago
  Sure , I am from India. The diary sector in India is largely unorganized , these are managed as daily livelihood for poor income families who have at best a few cows that provide them with livelihood. The co-operative sector in India mentioned how imports from NZ will wreck the system , for example the largest co-operative AMUL in India was against RCEP and imports from NZ (https://www.nationalheraldindia.com/india/rcep-amul-warns-modi-government-letter-to-piyush-goyal-likely-to-fall-on-deaf-ears https://www.nationalheraldindia.com/india/rcep-amul-warns-mo...) The exact trade rules and local content are in many cases impossible to vet and verify and are in many cases not transparent. And given the sentiment in India , no one will take chances with China
  - nl 6y ago
    This just seems a naked protectionism argument.
    - cocoland2 6y ago
      Yeah! , that is why India is not (yet) a participant on RCEP. Given that I am in rural India , if protectionism saves someone from starvation , I am fine with it.
      - kenneth 6y ago
        I imagine if you're posting on HN, you're not at imminent risk of starvation. (No value judgement on your position though, I generally think that this treaty is a bad thing due to its role in expanding China's power and influence, when it should be contained.)
        cocoland2 6y ago
        Point taken! It was not so much about me , financials are not a stance for my living. Philosophical as it may sound , my worry is for the hand cart puller who walks all day in pretty hot sun here , or for that maid whose husband has lost his daily wages due to COVID and how she makes ends meet for her kid selling milk to a co-operative here. India lives in its villages (quot: Mahatma Gandhi) and taking a livelyhood off in the name of globalization may not augur well with rural households in the long run
        simonh 6y ago
        I do understand and sympathise, genuinely, but I think this approach is what has held India back for the last few generations. Just look at the speed with which China has modernised over the last 30 years in comparison. Protectionism freezes an economy and society in place. Yes this policy helps some rural families, but it also condemns all the other rural families to getting only variable quality, intermittently available, expensive dairy products. Every protectionist support for a local industry imposes a cost on everyone else, to the point where everyone benefits a bit from protection, but also pays costs on all the goods and services they themselves consume. It may even be sustainable, but only at the price of sacrificing the chance of a better future. Change is painful, no doubt about it, but opening up to international markets can also mean opening up to international investment, technical skills and partnerships. It needs to be coordinated and there should also be transition plans to mitigate some of the pain. I do believe it’s for the best though.
  - stirlo 6y ago
    Sorry but that's what free trade means. If NZ produces dairy products more efficiently then they deserve the benefits. At the same time in India where manufacturing is far more efficient they have the opportunity to export as many manufactured goods to NZ as they want. If the Indian government wants to tax their manufacturers to provide support to their now unemployed dairy farmers they are free to do so but ultimately both countries are better off with India paying overall less for dairy and NZ paying less for manufactured goods.
    - AnHonestComment 6y ago
      Most people aren’t free trade absolutists — they want a mixture of free trade and national security. One example is US ITAR restrictions, which prevent certain technologies being exported. Another is looking to protect local food supplies against foreign competition — eg, dairy co-ops from foreign mega farms. There’s lots of empirical evidence that a mixed system is more stable with little to no loss to innovation. Most recently, COVID demonstrated the problem with foreign supply chains.
  - andylynch 6y ago
    Interesting point on Indian dairy co-ops. The NZ dairy industry, has from the very beginning had a strong co-op focus as well as being concentrated on exports, even as its beginnings in the nineteenth century. Despite great pushes over the last forty years this remains in modern form to the present day and is seen by NZ farmers as an essential part of their success, as this has allowed them to pool resources and invest in the vertical integration (transport, factories, shipping) to compete overseas. A similar structure also exists in other countries (US with DFA milk, Denmark & Sweden with Arla are also in the top ten global dairy companies) Until the early 1980s, NZ also operated a very protectionist trade policy dependent on access to traditional markets which ultimately failed badly. This experience and the (painful) resulting changes is a major reason why NZ is such a proponent of trade agreements and multilaterality more generally on the global stage.
  - naruvimama 6y ago
    There are multiple reasons to have cattle in India. One important ecological reason is production of manure, another is the preservation of local breeds, which often produces high quality but low quantities of milk. The more immediate concern is that making millions of families dependent on government hand outs would be disastrous.
  - howlgarnish 6y ago
    I'd understand an uproar against melamine labeled as milk etc being imported from China, but the concept that a pint-size country like NZ (population 5 million) with extremely expensive labor & shipping costs can "wreck" the dairy industry of a country of ~1.4 billion where the cost of labor is a rounding error is astonishing.
    - op03 6y ago
      All kinds of things are possible these days - https://www.nationalgeographic.com/magazine/2017/09/holland-agriculture-sustainable-farming/ https://www.nationalgeographic.com/magazine/2017/09/holland-...
    - ksec 6y ago
      >with extremely expensive labor & shipping costs can "wreck" the dairy industry of a country of ~1.4 billion where the cost of labor is a rounding error is astonishing. You are severely under estimating the cost efficiency of modern mass manufacturing vs a country with very little to no infrastructure in the segment.
satya71 6y ago
Also, India bare has free-trade within the country. That's the easier and lower hanging fruit.

nl 6y ago

> huge red flags domestically Probably useful to specify what country you are in. > Diary[sic] & associated products from NZ to India NZ dairy is generally considered high quality and good cost, so it is unclear what the problem is here > Chinese goods getting re-routed through Vietnam People say this like customs enforcement agencies don't know about this. In some cases this is acceptable, but it depends on the exact trade rules about the amount of local content that needs to be added in a country.

cocoland2 6y ago
Sure , I am from India. The diary sector in India is largely unorganized , these are managed as daily livelihood for poor income families who have at best a few cows that provide them with livelihood. The co-operative sector in India mentioned how imports from NZ will wreck the system , for example the largest co-operative AMUL in India was against RCEP and imports from NZ (https://www.nationalheraldindia.com/india/rcep-amul-warns-modi-government-letter-to-piyush-goyal-likely-to-fall-on-deaf-ears https://www.nationalheraldindia.com/india/rcep-amul-warns-mo...) The exact trade rules and local content are in many cases impossible to vet and verify and are in many cases not transparent. And given the sentiment in India , no one will take chances with China
- nl 6y ago
  This just seems a naked protectionism argument.
  - cocoland2 6y ago
    Yeah! , that is why India is not (yet) a participant on RCEP. Given that I am in rural India , if protectionism saves someone from starvation , I am fine with it.
    - kenneth 6y ago
      I imagine if you're posting on HN, you're not at imminent risk of starvation. (No value judgement on your position though, I generally think that this treaty is a bad thing due to its role in expanding China's power and influence, when it should be contained.)
      - cocoland2 6y ago
        Point taken! It was not so much about me , financials are not a stance for my living. Philosophical as it may sound , my worry is for the hand cart puller who walks all day in pretty hot sun here , or for that maid whose husband has lost his daily wages due to COVID and how she makes ends meet for her kid selling milk to a co-operative here. India lives in its villages (quot: Mahatma Gandhi) and taking a livelyhood off in the name of globalization may not augur well with rural households in the long run
        simonh 6y ago
        I do understand and sympathise, genuinely, but I think this approach is what has held India back for the last few generations. Just look at the speed with which China has modernised over the last 30 years in comparison. Protectionism freezes an economy and society in place. Yes this policy helps some rural families, but it also condemns all the other rural families to getting only variable quality, intermittently available, expensive dairy products. Every protectionist support for a local industry imposes a cost on everyone else, to the point where everyone benefits a bit from protection, but also pays costs on all the goods and services they themselves consume. It may even be sustainable, but only at the price of sacrificing the chance of a better future. Change is painful, no doubt about it, but opening up to international markets can also mean opening up to international investment, technical skills and partnerships. It needs to be coordinated and there should also be transition plans to mitigate some of the pain. I do believe it’s for the best though.
- stirlo 6y ago
  Sorry but that's what free trade means. If NZ produces dairy products more efficiently then they deserve the benefits. At the same time in India where manufacturing is far more efficient they have the opportunity to export as many manufactured goods to NZ as they want. If the Indian government wants to tax their manufacturers to provide support to their now unemployed dairy farmers they are free to do so but ultimately both countries are better off with India paying overall less for dairy and NZ paying less for manufactured goods.
  - AnHonestComment 6y ago
    Most people aren’t free trade absolutists — they want a mixture of free trade and national security. One example is US ITAR restrictions, which prevent certain technologies being exported. Another is looking to protect local food supplies against foreign competition — eg, dairy co-ops from foreign mega farms. There’s lots of empirical evidence that a mixed system is more stable with little to no loss to innovation. Most recently, COVID demonstrated the problem with foreign supply chains.
- andylynch 6y ago
  Interesting point on Indian dairy co-ops. The NZ dairy industry, has from the very beginning had a strong co-op focus as well as being concentrated on exports, even as its beginnings in the nineteenth century. Despite great pushes over the last forty years this remains in modern form to the present day and is seen by NZ farmers as an essential part of their success, as this has allowed them to pool resources and invest in the vertical integration (transport, factories, shipping) to compete overseas. A similar structure also exists in other countries (US with DFA milk, Denmark & Sweden with Arla are also in the top ten global dairy companies) Until the early 1980s, NZ also operated a very protectionist trade policy dependent on access to traditional markets which ultimately failed badly. This experience and the (painful) resulting changes is a major reason why NZ is such a proponent of trade agreements and multilaterality more generally on the global stage.
- naruvimama 6y ago
  There are multiple reasons to have cattle in India. One important ecological reason is production of manure, another is the preservation of local breeds, which often produces high quality but low quantities of milk. The more immediate concern is that making millions of families dependent on government hand outs would be disastrous.
- howlgarnish 6y ago
  I'd understand an uproar against melamine labeled as milk etc being imported from China, but the concept that a pint-size country like NZ (population 5 million) with extremely expensive labor & shipping costs can "wreck" the dairy industry of a country of ~1.4 billion where the cost of labor is a rounding error is astonishing.
  - op03 6y ago
    All kinds of things are possible these days - https://www.nationalgeographic.com/magazine/2017/09/holland-agriculture-sustainable-farming/ https://www.nationalgeographic.com/magazine/2017/09/holland-...
  - ksec 6y ago
    >with extremely expensive labor & shipping costs can "wreck" the dairy industry of a country of ~1.4 billion where the cost of labor is a rounding error is astonishing. You are severely under estimating the cost efficiency of modern mass manufacturing vs a country with very little to no infrastructure in the segment.

satya71 6y ago

Also, India bare has free-trade within the country. That's the easier and lower hanging fruit.