Cabinet clears proposal to ratify WTO’s trade facilitation pact

The TFA apart from speeding up the movement of goods that included shipments in transit, it “also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues” The Dollar Business Bureau
shutterstock_215801893-650 WTO On Wednesday, the Union Cabinet chaired by Prime Minister Narendra Modi also approved the instrument of acceptance to be submitted by the government to the WTO Secretariat.
  The Union Cabinet has given its nod to a proposal for ratification of the Trade Facilitation Agreement (TFA) of the World Trade Organization (WTO), which seeks to ensure quick and smooth flow of goods in the international trade. So far, 69 of 162 members of the global body has ratified the TFA—an outcome of the Bali Ministerial Conference of WTO held in 2013, also known as the Bali Package. Before its world-wide implementation, the pact needs to be formally accepted by at least two-third of the total member countries. On Wednesday, the Union Cabinet chaired by Prime Minister Narendra Modi also approved the instrument of acceptance to be submitted by the government to the WTO Secretariat. Apart from speeding up the movement of goods that included shipments in transit, the TFA “also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues”, a statement from the Ministry of Commerce and Industry said on Wednesday. “These objectives are in consonance with India’s ‘Ease of Doing Business’ initiative,” it said. Before implementing the provisions of TFA, India has asked for five years’ time from the WTO to make amendments to its foreign trade related legislations and adopt technologies required, the Commerce and Industry Minister Nirmala Sitharaman said while interacting with media persons on Wednesday. The cabinet has also given its nod for the formation of a National Committee on Trade Facilitation to facilitate domestic coordination and implementation of the provisions of the agreement. The Committee will be jointly headed by Secretary, Department of Revenue and Secretary, Department of Commerce. According to the government, the WTO has already included several of its proposals in TFA, which includes the mechanism on exchange of information between customs authorities for preventing under-invoicing and illegal flow of money. India’s other proposals that have been part of TFA are:
  1. Uniformity in border procedures and documentation requirements at all customs stations
  2. Giving importers an option to return rejected goods,
  3. Provision of a second test when the first test gives adverse results, and
  4. Transparency in administration of alert notifications by different countries.
Highlighting the areas where the country needs legislative changes, the Commerce Ministry said that the scope of advance ruling has to be broadened to extend the facility to “any importer, exporter or any person with a justifiable cause”. As per the existing norm, advance rulings are applied to a few entities such as joint ventures and foreign investors. “Release of goods before payment of duty will have to be allowed on a guarantee/ surety in all cases of imports where the duty is not determined prior to or upon arrival, or as rapidly as possible after arrival,” the ministry said. Besides, India also needs to relax the procedure for re-import and re-export of goods and facilitate smooth flow of perishable goods. India has already put in place a number of measures of TFA such as online publication of trade-related procedures and documents, advance rulings in the matters of tariff classification and country of origin, pre-arrival processing of import documents and facility of electronic payment. Other provisions that have already been implemented by the government include
  1. Allowing release of goods on bank guarantee in cases of delay in assessment,
  2. Applying “risk management” and “post clearance audit” in customs clearance, and
  3. Facilitating express shipments. 

Feburary 18, 2016| 4:51pm IST.

The Dollar Business Bureau - Feb 18, 2016 11:19 IST
 
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