India’s zinc-trade deficit with Korea tells why we need industry input on deals5 min read . Updated: 05 Apr 2022, 02:04 AM IST
India’s vast zinc-trade deficit with Korea shows why we need the inputs of domestic industry before we negotiate agreements
India aspires to be third largest economy in the world by the year 2047 and there is a strong push by the government to make India “atma-nirbhar" or self-reliant and play a bigger role in the global economy. Indian industry has responded enthusiastically to this call for self-reliance, and many have been investing heavily in the domestic market. Yet, the example of past trade agreements show that imports of certain raw materials and intermediate goods rose significantly after India signed these trade pacts, leading to a large deficit in the trade of select products for which India has ample domestic manufacturing capabilities. The core issue raised here by Indian industry relates to the Rules-of-Origin (RoO) in some of the earlier trade agreements. For example, our steel and zinc industry has raised concerns over the RoO in the India-Korea Comprehensive Economic Partnership Agreement (CEPA), which was signed on 7 August 2009 and came into force on 1 January 2010. During recent stakeholder consultations organized by the Indian Council for Research on International Economic Relations (Icrier), Indian industry recommended that the government should carefully look at the RoO, and that this should not be neglected in a rush to sign trade agreements.