INDIA TO FOCUS ON INCREASING MARKET ACCESS IN WTO INDUSTRIAL TARIFF NEGOTIATIONS FICCI ROUND TABLE ON WTO NEGOTIATIONS ON INDUSTRIAL TARIFFS AND MARKET ACCESS
Date : 29 Nov 2002
Location : New Delhi
India will take up the issue of peak tariffs in developed country markets and the non-tariff barriers that Indian exporters have to face in the WTO negotiations on Industrial Tariffs and Market Access so as to substantially increase market access for India’s goods and services in those countries. Addressing a Round Table on WTO Negotiations on Industrial Tariffs and Market Access organised by Federation of Indian Chambers of Commerce & Industry (FICCI), here this morning, Shri Dipak Chatterjee, Commerce Secretary, said that these issues had become onerous in view of the various preferential trade arrangements (PTAs) and Free Trade Areas (FTAs) that had come up giving many other developing countries far better access. "We have to innovate our strategies if we want to attain the target of 1% of global trade in the near future", Shri Chatterjee said. He reiterated the government’s resolve to continuously consult all stakeholders in WTO matters and emphasised the importance of seeking suggestions of all participants in deciding the approach that the country should take in the ongoing negotiations on market access for non-agricultural products (Industrial Tariffs).
Explaining the background, Shri Chatterjee said that the mandate for negotiations on market access for non-agricultural products had been given by the Doha Declaration which was adopted at the Doha Ministerial Conference of the WTO in November last year. Since then, work has commenced on this subject as also in several other areas. The Doha work programme has to conclude as a single undertaking by 1st January, 2005, while the 5th Ministerial Conference of the WTO at Cancun (Mexico) in September 2003 could provide an opportunity for a mid-term review.
The mandate for negotiations on market access for non-agricultural products was fairly clear, Commerce Secretary said. "The focus is on reduction or elimination of tariffs and a special reference has been made to reduction/elimination of peak tariffs, tariff escalations and high tariffs and removal of non-tariff barriers, particularly in respect of products of export interest to developing countries. Special and Differential treatment including less than full reciprocity in reduction commitments is built into the mandate. Already three meetings of the Negotiating Group have been held earlier this year which have been more in the form of exchange of views. One more meeting will be held next week. As per the time table drawn up for the negotiations, the first stage will be for finalisation of modalities. Proposals on modalities have to be submitted by 31st December, 2002. Based on these, the modalities have to be finalised by May next year. Only after that, will actual negotiations on tariff concessions take place. Modalities however, have an important role in the negotiations. Normally, these are taken to mean what approach we should take to tariff reductions, whether it will be by formula, or by request offer etc., whether all unbound items should be bound, what is the base year to be used for reference and what is the base rate of duty for from which to make reductions etc. We need to exercise great care even at this stage of formulation of modalities since they will have a great bearing on the actual negotiations that will follow", he said.
Some of the developed countries have already submitted their proposals. Earlier this week, the US Trade Representative (USTR) had also announced a far-reaching proposal, which needs to be examined, he said, adding that the government is in the process of formulating its proposals on the modalities.
The whole issue of industrial tariffs has to be looked at also in the context of reforms that has been undertaken in India including through reductions in tariff. In the last two budgets, a clear roadmap was laid down to bring down the country’s tariffs to the level of 10% and 20% by 2004. It is important to see how these tariff reductions that were brought about autonomously could be leveraged with a view to securing greater market access for India in other countries. In this, the objective of achieving high export growth was of paramount importance, he said.
Shri Chatterjee also pointed that the results of the market access negotiations would be implemented over a period starting from the conclusion of the negotiations by around 2005 and could extend upto 2010 thereafter, going by past precedents. He requested the participants to factor in to this aspect while making their suggestions. Shri S.N. Menon, Additional Secretary, Ministry of Commerce & Industry was also participated in the Round Table along with senior representatives of trade and industry.