- The WTO’s Trade Facilitation Agreement represents an important milestone by creating an international framework for reducing trade costs. The Trade Facilitation Agreement (TFA) contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective co-operation between customs and other appropriate authorities on trade facilitation and customs compliance issues. These objectives are in consonance with India’s “Ease of Doing Business” initiative.
- India Notified its category “A” commitments to WTO under the (TFA) in March, 2016. Approximately 70% of the total provisions given under TFA have been notified as category “A”. India has not categorised any provisions under category “C”. Subsequently the Agreement was ratified in April, 2016 and entered into force in February, 2017 [Category “A” commitments were subjected to be implemented while TFA came into force. India has implemented these commitments. Rest of India’s commitments are category “B” with a timeline for implementation up to Feb 2022 (though India has implemented some of these already like National Single Window)].
- India believes that Trade Facilitation is particularly important for developing countries, as studies show they stand to gain the most from more efficient trade procedures, although achieving it may be more challenging for these economies than for the developed world. But even modest reductions in the cost of trade transactions would have a positive impact on trade for both the developed and the developing world.
- A National Committee on Trade Facilitation (NCTF) was accordingly set up to facilitate both domestic coordination and implementation of the provisions under the Chairmanship of the Cabinet Secretary.
- NCTF is a three tiered body – NCTF as the apex body, Steering Committee Jointly Chaired by Secretary, Revenue and Secretary, Commerce at the mid-level and 5 adhoc Working Groups at the lower level to deal with specific issue of Time Release study, Infrastructure up gradation, Legislative issues, Outreach program and issues related to Participating Government Agencies (PGAs).
- In order to optimize the gains of Trade Facilitation, National Trade Facilitation Action Plan (NTFAP) for 2017-2020 containing specific activities to further ease out the bottlenecks to trade was prepared. The action points in the Plan is mapped to the WTO Trade Facilitation Agreement (TFA) Articles and aligned to our policy objectives on improving the Ease of Doing Business. It includes 90+ Trade Facilitation activities with definite timelines for their implementation. Each activity is associated with a principal agency responsible for its implementation in strict timelines short term (up to 6 months), mid-term (6-18 months) and long term (18-36 months). Most of the activities are TFA plus.
- Since then, the NCTF has played an important role in reducing the high cost of imports and exports so as to integrate our cross-border trade with the global value chain. Some of the landmarks being, –
a. establishment of a National Single Window system to route all import related formalities viz. examination, sampling, clearance etc., which involves plethora of agencies, through a single online national portal;
- Consistent Trade Facilitation efforts have resulted in substantive improvement of India’s performance in Trading Across Borders indicator from 146 in 2017 to 68 in the year 2019.
- Further, these initiatives have also contributed to overall improvement in ‘Ease of Doing Business’ environment in the country, as also recognized by the World Bank.
- To move forward on the implementation of TFA, India has also notified Transparency notifications at the WTO in April, 2019.
- A new NTFAP for the next period of 2020 to 2023 is under preparation with a vision to take additional reforms to bolster trade facilitation efforts and transform the cross-border clearance eco-system through efficient, transparent, risk based, coordinated, digital, seamless and technology driven procedures which are supported by state-of-the-art seaports, airports, land border crossings, rail, road and other logistics infrastructure.
b. simplification of fees and charges for various clearance related activities at the borders;
c. paperless filing of import/export documents through ‘E-sanchit’ project; and
d. publishing of resource information viz. procedures for import/export, laws & regulations etc. online for ease of access.