The Regional Comprehensive Economic Partnership (RCEP) is a free trade agreement (FTA) signed on November 15, 2020, among 15 Asia-Pacific countries, making it the world's largest trade bloc by GDP. The agreement was conceived at the 2011 ASEAN Summit in Bali, Indonesia, and negotiations formally launched in November 2012 in Phnom Penh, Cambodia. The primary problem it sought to solve was the integration of multiple, overlapping trade agreements—known as the ASEAN+1 FTAs—into a single, unified framework to strengthen economic linkages and enhance trade and investment across the region.
RCEP entered into force on January 1, 2022, for the first ten ratifying countries. Its key mechanism is the elimination of approximately 92 percent of tariffs over a 20-year period, including the complete elimination of tariffs and quotas on over 65% of goods traded within the bloc. A crucial provision is the creation of a single set of Rules of Origin for all 15 members, which facilitates international supply chains and reduces the complexity of operating under multiple agreements. The agreement covers 20 chapters, including trade in goods and services, investment, e-commerce, and intellectual property rights. It connects to the Association of Southeast Asian Nations (ASEAN), as the 10 ASEAN member states are at its core, alongside five of their major trade partners: Australia, China, Japan, South Korea, and New Zealand.
The most significant recent change involves India's position: India, which was one of the original 16 negotiating countries, decided to opt out of the agreement in November 2019 due to concerns over potential trade imbalances, particularly with China, and the protection of its domestic industry and agriculture. The final agreement, signed in 2020, includes a Ministerial Declaration stating that India may commence accession negotiations at any time. India's concerns, such as demands for amendments in tariff differentials and modifications to the Most Favoured Nation (MFN) rule, remain unresolved, and the Ministry of Commerce & Industry stated in December 2024 that India is not reconsidering its stand.