Trade gap with Delhi increases to $2.91b
A high-powered team headed by Commerce Minister Faruk Khan left for
India Thursday to find out ways to address the huge trade gap with
India.The 23-member delegation including 16 business leaders will take
up issues related to increasing bilateral relation between the two
neighbouring countries.
It may be mentioned that Bangladesh's trade imbalance with India has
widened by $1.37 billion over the last five years mainly due to
imposition of para-tariff and non-tariff barriers on Bangladeshi
products by Indian authorities.
The country's trade gap with India increased to nearly $ 2.91 billion
in 2009-10 fiscal year against $ 1.62 billion in 2005-06 fiscal, a
Commerce Ministry statement said.
The statement, however, said Bangladesh's trade imbalance continued to
rise in the last five fiscal years following a mismatch between the
country's exports to India and imports from its neighbour.
Bangladesh exported products worth of $ 241.96 million in 2005-06
fiscal year against its imports of $ 1868 million.
On the other hand, the country's total exports to India marked a
marginal rise to $ 304 million in 2009-10 fiscal as against its
imports from India amounting to $ 3213 million, the commerce ministry
figures showed.
Terming various para-tariff and non-tariff barriers main hindrances to
the growth of Bangladesh's exports to India, the commerce ministry
statement said exporters and businessmen said they often face a good
number of non-tariff and para-tariff barriers while exporting to
India.
These include education tax at 0.08 per cent and 0.16 per cent on
tariff value for cotton items and non cotton items, Indian customs
authority asks for laboratory test for each and every consignment of
food products, cosmetics, leather and textile products. Exporters are
subjected to pay Rs. 3000 as laboratory test fee for each type of food
items. The laboratory report normally takes 15-20 days as the samples
are sent by ordinary mails to the laboratories located far from the
land customs stations which delays the clearance of consignment.
Furthermore, the Indian authorities have recently imposed 18 per cent
tax and value added tax (VAT) as central value added tax, Special
Central Vat and Education Tax on apparels of Bangladesh origin defying
the SAFTA agreement.
Under the SAFTA list of sensitive goods, India is supposed to provide
duty-free access to 8.0 million pieces of apparels originating from
Bangladesh from 2008.
Original SAFTA certificate issued by the Export Promotion Bureau (EPB)
is not accepted by Indian customs at Agartala. Indian customs men ask
both the exporters and importers to submit details of rules of origin
calculation along with the documents, ignoring the set criteria of the
regional agreement, according to the list.
Sanitary import permit has been made mandatory for Indian importers of
processed food, toiletries and cosmetics from Bangladesh.
Indian government has recently imposed 18 per cent extra duty on
cement imports from Bangladesh, affecting cement exports to India's
North Eastern region.
Packaging requirement has been specified for food items with maximum
retail price, standard unit, month and year of packaging to be
inscribed on the packets. All pre-packaged commodities like processed
foods, cosmetics, toiletries, spices imported by India requires
generic and common name of the commodity packed, net quantity in terms
of standard unit of weights and measures.
Non-tariff barrier like inordinate delay in clearance of Bangladeshi
goods from customs for various reasons, including non-availability of
their designated officers and certificates from departments concerned
of the Indian government causes problems for Bangladeshi exporters.
Besides, inadequate physical facilities like warehousing,
transshipment yard, parking yard and connecting roads at land customs
stations of India also hinder exports from Bangladesh, the list
pointed out.
The Bangladesh delegation now in India will sign two agreements on
border hat and standard operating procedures (SOP) on truck movement
between the two countries on October 23.
Two places in both the countries have been initially selected for the
hat. The hat will be located at Baliamari in Kurigram district and
Lawar Ghar in Sunamganj district in Bangladesh and Kalai Char and Bala
in Meghalaya in India. It is expected that the hat will start by
December this year.
A number of issues including removal of tariff and non-tariff
barriers, duty-free access to Indian market, further reduction of 61
items from India's negative list, Free Trade Agreement (FTA) and
investment, relaxing universal Indian ban on cotton export to
Bangladesh are likely to dominate official talks between Bangladesh
and India.
The list of 61 items includes 49 ready-made garment (RMG) products.
The major goods under 61 items of the Indian sensitive list include
different kinds of RMG, soybean oil, refined palm oil, aviation
turbine fuel and fuel oil, natural rubber (smoked sheets), toilet or
facial tissue stock, sanitary napkin, all kinds of paper or paperboard
labels and silk fabrics.
Meetings will be held between Commerce Minister of Bangladesh and
Industries Minister Ananda Sharma and Minister for Development of
North Eastern Region PK Handik of India.
The delegation will also participate in discussions with the leaders
of Federation of Indian Chamber of Commerce and Industry (FICCI) and
Confederation of Indian Industries (CII), among others.
The team is expected to come back on October 24 after the four-day visit.
http://www.thefinancialexpress-bd.com/more.php?news_id=115426&date=2010-10-22
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