'Tackling NTBs must for India-EU free trade pact'

New Delhi, Oct 8: India and the 25-nation EU need to tackle non-tariff barriers (NTBs) that exist in each other's markets to fully benefit from a bilateral trade and investment agreement, an industry body CII said.

The trade agreement is to be finalised at the two-day India-EU Summit at Helsinki from October 11.

A study done by CII shows that nearly 23.38 per cent of total exports of India to EU are covered by NTBs -- especially in the area of carpets (86.2 per cent), textiles and clothing (65.85 per cent) and leather (31.35 per cent).

Infact, India is one of EU's most targeted countries affecting 3.5 per cent of the Indian exports as against the global average of 1.5 per cent, according to a study done by Dr Jayanta Roy, Principal Advisor CII.

The study shows that out of 84 antidumping cases initiated against exports from India, the highest amount of 33 per cent are from the EU. It also accounts for 44 per cent of anti-subsidy cases.

Standards are another area of concern and sometimes differing standards between EU countries can be a cause for concern for exporters from India.

CII is of the view that there is a need for the two countries to discuss ways and means of overcoming this serious hindrance to bilateral trade flows. In the area of services, CII feels that the biggest hindrance to greater engagement would be mutual recognition agreements (MRAs).

The chamber says that the negotiations for mutual recognition agreements in areas of interest to both sides should be negotiated alongside the trade and investment agreement. The agreement should contain the MRAs that have been signed.

Some areas of interest to India for MRA's would be architecture, accountancy and nursing among other areas. One area of focus for India to boost trade would be trade facilitation, according to CII.

There is an urgent need for India to focus on this area and should work with the EU to ensure that the time period for goods at ports should be reduced to the minimum.

It feels that implementation of Electronic Data Interchange (EDI) should be extended beyond customs to all other agencies involved to achieve a fully automated and paperless system.

India can draw on the experience of Europe in the implementation of Single Administrative Document, Customs Law, New Computerised Transit System, the chamber said.

UNI