Central Idea

Sri Lanka and Bangladesh are considering joining the Regional Comprehensive Economic Partnership (RCEP) after India’s withdrawal from the trade agreement in 2019.

Recent update on RCEP

Sri Lanka’s Application: Sri Lanka has applied for RCEP membership and seeks support from China, Malaysia, Indonesia, Japan, and Thailand.
Bangladesh’s Decision: Bangladesh is expected to make a final decision on RCEP membership after its elections in January 2024.

Scope	Free trade agreement among 15 Asia-Pacific countries
Member Countries	Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, Philippines, Singapore, South Korea, Thailand, Vietnam
Negotiations and Signing	Negotiations started in 2012, Officially signed on November 15, 2020
Entry into Force	Effective from January 1, 2022
Objectives	Reduce trade barriers, promote economic growth, enhance economic cooperation
Trade Facilitation	Includes tariff reductions, trade in services, rules of origin, customs procedures, and trade remedies
Market Access	Improves market access for goods and services among member countries
Accession Rules	Expected to be finalized by 2024
Global Significance	Significant due to large economies like China, Japan, and South Korea
India’s Withdrawal	India initially participated but withdrew in 2019 citing concerns about trade deficits and domestic industries

Past Withdrawal: India withdrew from RCEP talks in 2019 due to concerns over services mobility, potential flood of Chinese goods, and objections from domestic agriculture and small businesses.
No Indication of Return: India has not indicated any reconsideration of its decision to withdraw from RCEP.

Learning from Crisis: Sri Lanka realizes the importance of regional markets during crises and hopes to spread its market and enhance competitiveness.
Bangladesh’s Graduation: As Bangladesh approaches graduation from the list of Least Developed Countries in 2026, joining RCEP could offset potential export losses and simplify FTA negotiations.