For better international competitiveness in trade deals, India needs to strengthen its domestic house in line with urgent unilateral trade liberalisation that began in 1991. Explain (200 Words)
Refer - Business Standard
Enrich the answer from other sources, if the question demands.
IAS Parliament 5 years
KEY POINTS
Trade and logistics facilitation reforms are big constraints to rapid growth of exports and foreign direct investment (FDI).
But considerable reforms were undertaken recently in this particular area, which are reflected in sharp improvements in the rankings of World Bank’s Ease of Doing Business, Trading Across Borders and Logistics Performance indicators.
Strengthening internal and external policies
· Tariff rationalisation: This is the first reform that is required to maintain international competitiveness and make industry fully integrated into the global economy.
· Average tariff level in India for non-agriculture sectors is 13.6 per cent, a bit higher with tariff hike in the recent Budget, compared to 5.3 per cent in Malaysia, 7.3 per cent in Thailand and 8.4 per cent in Vietnam.
· This reduction is a must for not only promoting exports, but to also benefit from RCEP, or any bilateral free-trade agreement (FTA).
· Realistic exchange rate: Correcting the overvaluation of exchange rate over the past few years. This is crucial for reviving the export momentum.
· Trade and logistics facilitation reforms: To the credit of the Central Board of Indirect Taxes and Customs (CBIC), our cargo dwell time in ports and airports has been considerably reduced through adoption of modern risk management systems and automation.
· So has logistics development under the special wing created in the Ministry of Commerce and Industry.
· Trade negotiating strategy: India needs to behave like a major global player and take a proactive stance in trade in services, removal of subsidies and non-tariff barriers by not consistently pushing for temporary relocation of labour (Mode 4 of the General Agreement on Trade in Services) and Special and Differential Treatment (S&D).
· Connecting with the largest global value chain: A good way to carry forward unilateral trade liberalisation to next generation trade reforms is to start preparing to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) comprising the 11 original members of TPP, excluding the US.
· Membership in CPTPP will require achieving gold standard trade policy in elimination of tariffs and other barriers to trade and investment, a WTO + IPR regime and trade in services, adherence to competition policy, trade facilitation, reform of state-owned enterprises, investment policy, and government procurement.
Madeshwaran 5 years
Kindly review
IAS Parliament 5 years
Good attempt. Keep Writing.
Vendhan 5 years
TN ku
IAS Parliament 5 years
Good attempt. Keep Writing.
Anu 5 years
Kindly review. Thank you.
IAS Parliament 5 years
Good attempt. Keep Writing.
hema 5 years
Kindly review thank you
IAS Parliament 5 years
Try to mention about logistics reform, tariff rationalisation. Keep Writing.
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