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India to remove import duty on 4,400 items in January ’08

India to remove import duty on 4,400 items in January ’08
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First Published: Mon, Mar 26 2007. 11 41 PM IST
Updated: Mon, Mar 26 2007. 11 41 PM IST
India will, under the South Asian Free Trade Agreement (Safta), allow duty-free imports from January next year on 4,400 items from Bangladesh, Nepal, Bhutan, Maldives and Afghanistan. It will, however, continue to deny duty cuts on import of textiles, fish, meat, fruit and vegetables, pulses edible oils, industrial chemicals, and industrial dyes from these countries.
The concessions will be announced by Prime Minister Manmohan Singh at the 14th South Asian Association for Regional Cooperation (Saarc) summit being organized in the Capital from 3-4 April.
Senior government officials said the contours of the package will be finalized by the end of the week. The measures being considered include fast tracking the duty elimination on all commodities, except the negative list of 744 items, from 31 December 2007, a year ahead of schedule.
Another measure expected to be announced is the reduction in the negative list for all member countries to 10% of the total tariff lines offered by India under Safta.The move would bring down the number of items to around 520.Officials said Saarc member countries had at the time of operationalization of Safta from 1 January 2006 agreed to restrict the negative list to 20% of the tariff lines. India voluntarily offered to restrict its negative list to between 12% and15% of the tariff lines. “Pruning the list to 10% will provide our neighbours with increased market access,” an official, who did not wish to be identified, said.
Another concession being offered is that port restrictions on certain items, like textiles and tea which are imposed at present, would be removed. Officials said a special concession was also being made to Bangladesh, under which New Delhi will allow market access for eight million garment pieces irrespective of where the fabrics for the garments are sourced. A similar concession would also be given to Sri Lanka under the bilateral Comprehensive Economic Partnership Agreement which is under finalization.
According to trade expert Ram Upender Das, the intra-Saarc trade is around $8 billion (Rs34,400 crore) at present and the unilateral concessions being offered will be significant for the least developed countries since they are highly dependent on the Saarc market. Conversely, Bangladesh imports from Saarc amount to just 15% of its global imports. Hence, increased market access would help Bangladesh source more from the region, he added.
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First Published: Mon, Mar 26 2007. 11 41 PM IST