But “India has significant outstanding issues, which remained unresolved”, the statement said.

“All RCEP participating countries will work together to resolve these outstanding issues in a mutually satisfactory way. India’s final decision will depend on satisfactory resolution of these issues.”

The mammoth deal dominated the three-day Association of Southeast Asian Nations (Asean) summit and other related meetings in Thailand’s Nonthaburi province that ended on Monday.

Negotiators had worked for weeks to bring the deal to a conclusion at the summit, but India piled fresh demands at the eleventh hour, sources told This Week in Asia.

The 16 RCEP countries consist of the 10 Asean nations and its key trading partners China, India, South Korea, Japan, Australia and New Zealand.

“When I measure the RCEP agreement, with respect to the interest of Indians, I don’t get a positive answer,” Modi was quoted as saying.

Vijay Thakur Singh, a top Indian foreign ministry official for Asian affairs, said that having “participated in good faith in the RCEP negotiations and negotiated hard with a clear-eyed view of our interest”, New Delhi believed that “not joining the agreement is the right decision for India.”

Henry Gao, a law professor at the Singapore Management University focusing on international trade law, said an RCEP without India would be “even more worthwhile” for the so-called RCEP-15.

He cited two reasons: India’s “low ambitions” for the pact, and the high level of integration among the countries of East and Southeast Asia which are part of the RCEP-15.

“A mega trade deal like RCEP will only further accelerate the integration process and greatly boost trade and economic growth in the region,” Gao said.

Explained: Regional Comprehensive Economic Partnership (RCEP)

Earlier expectations were that the joint statement would declare at least a “substantial conclusion”, “near conclusion” or “in principle conclusion” of the RCEP, which aims to create a free-trade zone spanning 39 per cent of the world economy.

The phrasing used to describe the progress of negotiations is being closely parsed because, since it requires endorsement from all RCEP countries, it accurately captures the sentiment of all the 16 negotiating teams.

Last year, Singapore, as chair of Asean, pushed for a conclusion of the deal, but eventually the joint statement declared that only “substantial progress” had been made.

Indian media, citing government sources, said the pact’s inadequate protection against import surges, the possible circumvention of rules of origin, and a lack of “credible assurances” on market access and non-tariff barriers, proved too much for New Delhi to swallow.

Furious efforts that continued up to Sunday night failed to bridge the gap between India and the 15 countries.

India’s concerns about RCEP remain the major obstacle to world’s largest trade deal

Indian critics of the RCEP say the deal will have a ruinous impact on the South Asian economy, which has trade deficits with the other 15 countries.

The biggest opposition has come from the country’s long protected industries, such as its dairy sector, which fears it could be wiped out by lower tariffs on Australian and New Zealand products that would result from the RCEP.

Indian government sources on Monday said the country had not made last-minute demands, but Southeast Asian negotiators said major demands were made as late as Thursday.

On social media, supporters of the Swadeshi Jagran Manch (SJM), the economic wing of the nationalist Rashtriya Swayamsevak Sangh (RSS), cheered the government’s decision.

The RSS is the ideological fountainhead of Modi’s ruling Bharatiya Janata Party.

Sharma, the SJM’s spokesman, said the BJP political leadership had always viewed the RCEP with ambivalence but was pushed by bureaucrats to pursue the deal.

He rebuffed claims that the decision to exit the RCEP meant India was against free trade, saying that what India needed was a “level playing field”.

He cited non-tariff barriers put in place by the United States and China, including Beijing’s “digital iron curtain”.

Gao, the Singapore-based law professor, said it “makes sense for India to stay out” as it would have faced “a lot of competition from Chinese manufactured products” if it were part of the deal.

“India could temporarily shield its firms from Chinese competition by staying out, but whether this will work in the long term is a different question,” he said.

Conceived in 2012, the RCEP’s aim was to standardise the terms of Asean’s existing free trade pacts with the six non-Southeast Asian nations that are part of the deal.

The RCEP was originally seen as a China-backed alternative to the Trans-Pacific Partnership (TPP), a Washington-backed trade pact that the former US President Barack Obama championed.

President Donald Trump, elected in 2016 on a protectionist platform, swiftly took the US out of the 12-nation TPP. A watered down deal is in force among seven of the original 12 TPP countries.