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Escape clause to avoid disputes in pandemic, global response system with other agencies key: India to WTO

India has suggested the World Trade Organization (WTO) to consider possible escape clauses for countries to avoid disputes while using the flexibilities in global trade agreements in response to current and future pandemics and natural disasters.

New Delhi has also said that the WTO, along with other international organisations, needs to put in place a pandemic response system, that would map manufacturing capacities and demands, and allow special visas/permits for healthcare professionals besides creating a pool of resources of essential goods and services.

At a meeting of the General Council of the organisation a few days ago, India suggested the WTO Secretariat to catalogue the flexibilities under the existing pacts and also of those rules that can be relaxed, to enable members to respond to pandemics and natural disasters.

“We also need to identify WTO Agreements, which do not contain such flexibilities or escape clauses and examine possibility of providing flexibilities/escape clauses in such Agreements,“ India said, ahead of a key ministerial conference of the WTO in December.

On an international pandemic response system, India said during the current Covid-19 pandemic, a pool of goods such
as oxygen concentrators, essential medicines and oximetres, and services through temporary measures involving special permits for short duration supply of healthcare professionals for four to eight weeks, both physically or
remotely to address the acute shortages, could be created.

India also insisted that temporary measures such as trade facilitation measures and tariff liberalization, to handle pandemics and natural disasters, need not be made permanent as making them permanent would unnecessarily circumscribe the members’ policy space during normal times.

“Decision to take any measure permanent or not should be left to the concerned members, as per rights and obligations under the WTO” India’s representative said.

Moreover, while providing for regulatory coherence to avoid duplications and save time, due care should be taken to ensure that all regulatory authorities concerns have access to the regulatory dossiers.

Further, any WTO response to pandemics without the waiver from Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement will not be “credible”, India said .

The proposal, floated last year by India and South Africa, is now sponsored by 64 members and seeks to facilitate access to Covid medicines.

Easy cargo movement, startup collaboration key for India-ASEAN relationship: CII

Ahead of the India-ASEAN Summit next week, industry has pushed to prioritise the expansion of the scope of the Bilateral Air Services Agreement to enable easier cargo movement, and suggested collaboration between the startups of both sides in digital payments, e-commerce and cybersecurity, home healthcare, e-pharmacy, and fitness and wellness apps. The Confederation of Indian Industry (CII) has also said that India’s pharmaceutical industry can become a key supplier of generic drugs, medical devices and vaccines to the ASEAN nations.

ASEAN, or Association of Southeast Asian Nations, comprises 10 countries—Indonesia, Thailand, Singapore, Malaysia, the Philippines, Vietnam, Myanmar, Cambodia, Brunei and Laos.

“A regional approach to energy security will help manage its supply and demand m crucial requirement of these high-growth economies,” CII said in its report titled “ASEAN-India: Identifying emerging opportunities together”.

It added that India has begun collaboration with a few ASEAN countries such as Vietnam and Myanmar in areas such as renewable energy, and development of refineries.

With the success of CO-WIN app, India can support other countries who may want to use CO-WIN or design a similar digital vaccination management system, according to the industry chamber.

“An ASEAN Visa and cross-country exchanges related to cultural and leisure programmes will go a long way in increasing people-to-people connectivity and potentially boosting SME trade,” CII said in its report.

ASEAN-India trade witnessed a decline of 9.2% in FY21 owing to the pandemic and ASEAN’s trade expansion with US and China. The decline in trade and India’s increasing trade deficit in the last few years have led to a call for a review of free trade agreements (FTA) with ASEAN, as India targets better trade balance.

“The review will be aimed at issues such as removal of non-tariff measures, especially in the auto and agriculture sectors, and rules of origin,” CII said.

This is crucial as since the FTA finalisation, India’s imports from ASEAN continued to increase sharply, in comparison with exports. As a result, India’s trade deficit increased to $15.9 billion in FY21 from $4.9 billion in FY11.

WTO director-general to visit India soon

World Trade Organization (WTO) director-general Ngozi Okonjo-Iweala is likely to visit India in the next few weeks, ahead of the multilateral ministerial trade body’s key meeting.

Okonjo-Iweala may also meet indigenous vaccine manufacturers during her visit, which is expected towards the end of the month, people aware of the matter said. A final confirmation of the visit is awaited. “There is an indication she might come but nothing is confirmed yet,” said an official. As per another official, the DG is likely to visit India from October 20-22 and meet with industry leaders, especially those involved in vaccine manufacturing. The 12th ministerial conference of the WTO will take place from November 30-December 3. “India is a prominent player and has many concerns in multilateral trade talks. She might want to gauge India’s thinking before the ministerial,” said a trade expert.

At the WTO, India has been pushing for the food security programmes aimed at developing and poor countries to be allowed without any limits and for members who give trade-distorting farm subsidies above $10 billion to eliminate them within three years.

India has pitched for a reduction in fishing capacity of countries that fish in distant waters or in the territorial waters of other countries, in a bid to balance overfishing subsidy restrictions with the special needs of developing and least-developed countries.

The WTO aims to finalise disciplines to eliminate subsidies for illegal, unreported and unregulated (IUU) fishing, and prohibit certain forms of fisheries subsidies that contribute to overcapacity and overfishing.

Centre imposes stock limits on edible oils to soften prices in domestic market

The Centre on Sunday imposed stock limits on traders of edible oils and oilseeds, barring importers and exporters, till March 31, in a bid to check rising domestic prices and give relief to consumers.

Already, futures trading in mustard oil on NCDEX platform has been suspended from October 8, it said.

Edible oil prices in the domestic retail markets have shot up sharply by up to 46.15 per cent in the last one year due to global factors and local tight supply situation, as per government data.

“The centre’s decision will soften the prices of edible oils in the domestic market, thereby bringing great relief to consumers across the country,” the Food and Consumer Affairs Ministry said in a statement.

As per the order issued to all states, state governments and union territories will decide the stock limit to be imposed on edible oils and oilseeds after taking into account the available stock and consumption pattern of that particular state or UT.

However, certain importers and exporters have been exempted from the stock limit.

The exemption is given to those exporters (being a refiner, miller, extractor, wholesaler or retailer or dealer) who have an Importer-Exporter Code Number issued by the Director General of Foreign Trade (DGFT) and are able to demonstrate that the whole or part of his stock are meant for exports and to the extent of the stock meant for export.

The exemption is also given to those importers (being a refiner, miller, extractor, wholesaler or retailer or dealer) who are able to demonstrate that part of his stock in respect of edible oils and edible oilseeds are sourced from imports, the ministry said.

In case, the stocks held by respective legal entities are higher than the prescribed limits then they shall declare the same on the portal (https://evegoils.nic.in/EOSP/login) of Department of Food and Public Distribution and bring it to the prescribed stock limits as decided by the states where it is conducting its business within 30 days of the issue of such notification by the said authorities.

The states have been asked to ensure stock details of edible oils and oilseeds are regularly declared and updated on the central government’s portal, it said.

The Removal of Licensing Requirements, Stock Limits and Movement Restrictions on Specified Foodstuffs (Amendment) Order, 2021, has been issued with immediate effect from September 8, it added.

According to the ministry, high prices of edible oils in the international market have a substantial impact on the domestic edible oil prices. However, the government has formulated a multi- pronged strategy to ensure that prices of essential commodities like edible oils remain controlled.

Measures like rationalisation of import duty structure, launching of a web-portal for self-disclosure of stocks held by various stakeholders had already been taken, it said.

As per the data maintained by the Consumer Affairs Ministry, average retail prices of soya oil were ruling at Rs 154.95 per kg on October 9, this year, 46.15 per cent higher than Rs 106 per kg in the year-ago period.

Similarly, average mustard oil prices rose by 43 per cent to Rs 184.43 per kg from Rs 129.19 per kg, while that of vanaspati by 43 per cent to Rs 136.74 per kg from Rs 95.5 per kg in the said period.

In case of sunflower, its average retail price risen by 38.48 per cent to Rs 170.09 per kg on October 9 this year from Rs 122.82 per kg in the year-ago period, while palm oil prices rose 38 per cent to Rs 132.06 per kg from Rs 95.68 per kg in the said period.

India meets more than 60 per cent of its edible oil demands through imports.

Exports jump over 21% to $33.44 billion in September

India’s merchandise exports jumped 21.35 per cent to $33.44 billion in September on a year-on-year basis, mainly due to better performance by key sectors like engineering goods and petroleum products, according to preliminary data released by the government on Friday.

In September, merchandise imports stood at $56.38 billion, an increase of 84.75 per cent compared to the year-ago period. The same was at more than $30.52 billion in the same period a year ago. It is also up 49.58 per cent over September 2019 when it had totalled $37.69 billion.

The trade deficit in September was at $22.94 billion as gold imports jumped nearly 750 per cent to $5.11 billion.

As per the preliminary data released by the Ministry of Commerce and Industry, the trade deficit, which is the gap between imports and exports, works out to be $78.81 billion during April-September period.

“India’s merchandise exports in September 2021 was $33.44 billion, an increase of 21.35 per cent over $27.56 billion in September 2020 and an increase of 28.51 per cent over $26.02 billion in September 2019,” it said.

Exports of engineering goods stood at $9.42 billion, up 36.7 per cent over September 2020. The outward shipments of petroleum is estimated at $4.91 billion in September 2021, an increase of 39.32 per cent over the year-ago month.

Outward shipments of ‘gems and jewellery’ were 19.71 per cent higher at $3.23 billon. However, exports of ‘drugs and pharmaceuticals’ registered a decline of 8.47 per cent.

The imports of ‘petroleum, crude and products’ soared nearly 200 per cent to $17.436 billion in September on an annual basis.

The data also showed that imports of ‘coal, coke and briquettes’ were up 82.89 per cent at $2.18 billion in September 2021 over the same month last year.

The ministry said value of non-petroleum exports in September was $28.53 billion, a growth of 18.72 per cent over the year-ago period and 26.32 per cent higher compared to September 2019.

Value of non-petroleum imports was at $38.95 billion in September, an increase of 57.73 per cent compared to the same period a year ago, and 36.14 per cent over September 2019.

As per the data, value of non-petroleum and non-gems and jewellery exports in September was at $25.29 billion, registering a growth of 18.59 per cent year-on-year.

The exports in the first half of the fiscal (April-September 2021) stood at $197.11 billion. This is an increase of 56.92 per cent over $125.61 billion in the year-ago period and 23.84 per cent compared to April-September 2019.

Covid call: India wants WTO to consider ‘escape clauses’

India has pitched for a global pandemic response system that would map manufacturing capacities and demand of medicines and medical equipment and allow special visas or permits for healthcare professionals.

New Delhi also suggested that the World Trade Organization (WTO) consider ‘escape clause’ for countries, relying on flexibilities in trade agreements, to avoid disputes while tackling the current pandemic and any other in future.

India said during the current Covid-19 pandemic, a pool of goods such as oxygen concentrators, essential medicines and oximetres, and services through temporary measures involving special permits for short-duration supply of healthcare professionals for four to eight weeks, both physically or remotely to address acute shortages, could be created.

New Delhi asserted that any WTO response to pandemic without the waiver from Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement will not be “credible.”

cata

The proposal, floated last year by India and South Africa, is now sponsored by 64 members and seeks to facilitate access to Covid medicines.

At a meeting of the General Council of the organisation a few days ago, India suggested that the WTO Secretariat catalogue the flexibilities under the existing pacts and rules that could be relaxed, to enable members to respond effectively to pandemics and natural disasters.

“We also need to identify WTO agreements, which do not contain such flexibilities, or escape clauses and examine possibility of providing flexibilities/escape clauses in such agreements,” India said in its submission, ahead of a key ministerial conference of the WTO in December.

India insisted that temporary measures such as trade facilitation measures and tariff liberalisation to handle pandemics and natural disasters need not be made permanent, as that would unnecessarily circumscribe the members’ policy space during normal times.

“Decision to take any measure, permanent or not, should be left to the concerned members, as per rights and obligations under the WTO” India’s representative said.

India cuts import duty on cooking oils; September imports of palm oil are highest single month imports in

Amid persistently cooking oil prices since more than a year, the central government has reduced the import duty on crude and refined palm oil, soybean oil and sunflower oil between 16.5 % to 19.25% with effect from October 14 upto March 31, 2022. Meanwhile,

The impact of the duty reduction on crude palm oil is about Rs.14,000/- while on crude soyabean oil and crude sunflower seed oil is about Rs.20,000/- per tonne. “The total benefit of duty reduction may not fully accrue to the Indian consumer. In fact, today after the announcement of the duty reduction, the Malaysian Market has gone up by about RM 150 to 170 per tonne. Also, the rumours in the market in the last few days have already discounted the domestic price to some extent. The price of refined oil may further reduce by Rs 6 to 8 per kg,” said Atul Chaturvedi, president, Solvent Extractors’ Association (SEA).

The immediate trigger for this drastic duty reduction is largely on account of high price edible oil and onset of festive season and high food inflation. “However the timing of reduction of import duty is a cause of concern as farmers are now harvesting record kharif soya and groundnut crop and reduction in import duty may affect the farmers’ realisation for their produce,” said Chaturvedi.

According to SEA, import of vegetable oils during September 2021 is reported at 1,762,338 tons compared to 1,061,944 tons in September, 2020, consisting 1,698,730 tons of edible oils and 63,608 tons of non-edible oils i.e. up by 66%. The overall import of vegetable oils during November 2020 to September 2021 ( 11 months) is reported at 12,470,784 tons compared to 12,257,837 tons, up by 2% compared to last year.

Record Import in September 2021:
According to SEA, Import of edible oils during September, 2021 has set a new record of shipment of 16.98 lakh tons in a single month. Earlier in October ,2015 India had imported 16.51 lakh tons of edible oils. Palm Oil imports recorded in the month of September 2021 at 12.62 lakh tons is the highest in any single month since India started importing Palm Oil in 1996.

October 2021 stock at the highest level:
The stock of edible oils as on October 1, 2021 at various ports has been estimated at 845,000 tons and pipeline stock at 1,160,000 tons. Thus, the total stock is of 2,005,000 tons, mainly due to heavy import during September 2021. “The stock has increased by 255,000 tons to 20.05 lakh tons as on October 1, 2021 from 17.50 lakh tons as on September 1, 2021 and 16.02 lakh tons in October 2020,” said SEA.

Import of Palm Oil Products up due to duty advantage:
During the 11 months from November 2020 to September 2021, palm oil import has increased to 7,627,218 tons compared to 6,440,947 tons during same period of last year due to lower duty advantage compared to soft oils. Soft Oils import decreased to 4,458,029 tons compared to 5,509,554 tons due to high prices of soybean and sunflower oils in international market. Shipment of Crude Rapeseed Oil restarted from August 2021 due to high price of domestic rapeseed oil (mustard oil). Import of about 12,000 tons and 20,215 tons of rapeseed oil is reported during August and September 2021 respectively and expected increase during next 2 to 3 months to fill the shortage of mustard oil. The overall palm oil share increased to 63% compared to 54% in same period of previous year.

India’s coal import drops in August despite higher fuel demand from power sector

India’s coal import registered a decline of 2.7 per cent to 15.22 million tonnes (MT) in August this year amid the country’s power plants grappling with fuel shortages.

The country imported 15.64 MT of coal in the corresponding month last year.

According to data compiled by mjunction services, “Imports in August 2021 stood at around 15.22 million tonnes…imports in August 2021 were also down by 2.7 percent over August 2020.”

mjunction CEO and MD Vinaya Varma attributed the decline in volumes to the steady increase in seaborne coal prices coupled with the initiatives taken by the domestic miners for import substitution.

However, he said, there is a spurt in demand from the power sector.

“What impact it will have on imports, given the volatility in international prices, is to be seen,” he added.

Of the total import during August 2021, non-coking coal was at 9.08 MT, against 10.33 MT imported during August last year. Coking coal imports were at 4.37 MT, up against 3.17 MT imported during August 2020.

India’s coal imports during August 2021 through the major and non-major ports are estimated to have decreased by 6.71 per cent over July 2021.

Imports in July stood at 16.31 MT.

During April-August 2021, coal import stood at 92.49 MT, about 21.27 per cent higher than 76.27 MT imported during April-August 2020.

During April-August 2021, non-coking coal import was at 60.85 MT as compared to 51.23 MT imported during April-August 2020.

Coking coal imports were recorded at 22.19 MT, against 14.38 MT imported during the same period last year.

Coal India which accounts for over 80 per cent of domestic coal output had earlier said that due to skyrocketing coal prices in international markets, all the consumers have been vying for domestic coal, hiking up the demand.

Coal Minister Pralhad Joshi on Thursday said closure of some mines, and inundation of a few others due to monsoon led to the crisis but there is no need to panic as the situation is improving.

India for including TRIPS waiver proposal in WTO’s response package

Expressing disappointment over no progress on TRIPs waiver proposal to deal with the COVID-19 pandemic, India has called for including this proposal into the WTO‘s response package being deliberated upon. In October 2020, India and South Africa had submitted the first proposal, suggesting a waiver for all WTO (World Trade Organisation) members on the implementation of certain provisions of the TRIPs Agreement in relation to the prevention, containment or treatment of COVID-19.

In May this year, a revised proposal was submitted by 62 co-sponsors, including India, South Africa, and Indonesia. The agreement on Trade-Related Aspects of Intellectual Property Rights or TRIPs came into effect in January 1995. It is a multilateral agreement on intellectual property (IP) rights such as copyright, industrial designs, patents and protection of undisclosed information or trade secrets.

According to India’s statement delivered by Ambassador and Permanent Representative of India to the WTO Brajendra Navnit at the General Council Meeting held on 7-8 October, the waiver proposal was submitted (by India and South Africa) on Mahatma Gandhi’s birth anniversary on October 2 last year and ”we have lost a whole year and over 5 million lives while discussing this proposal”. ”It is disappointing to say the least that, even on such a critical, urgent and extraordinary issue despite commitments to engage in text-based negotiation, all we (WTO member countries) have done until now is debate and discuss the issue, thanks to a few members,” India has said. It has also stated that although WTO members have held several rounds of small group meetings, due to lack of substantive engagement by a few members, valuable time has been ”wasted” without an outcome.

According to a recent UNCTAD Trade and Development report, developing countries will, by 2025, be as much as USD 8 trillion poorer because of the coronavirus crisis, and the burden of delayed vaccination estimated at USD 2.3 trillion in terms of lost income will be borne mostly by developing countries. ”In light of such alarming data, it is disheartening to see how the interest of a majority has been conveniently side-lined, this differentiated approach to combat the pandemic is bound to fail. ”It is paramount to incorporate the waiver proposal into the WTO’s response package being deliberated upon, and we must ensure this is achieved to ensure a successful MC (ministerial conference) 12,” it said. The 12th Ministerial Conference (MC12) will take place from November 30 to December 3, 2021, in Geneva, Switzerland.

It was originally scheduled to take place from 8 to 11 June 2020 in Kazakhstan’s capital Nur-Sultan but was postponed due to the COVID-19 pandemic. The waiver component has to be finalised before this meet and any WTO response to pandemics without this waiver element will not be credible, it said. On the proposed fisheries subsidies agreement, India has informed that it has submitted a comprehensive proposal keeping in view the demands of developing countries and LDCs (least developing countries) on S&DT (special and differential treatment) for future policy space to persify and develop the fishing sector sustainably, especially in the high seas where many of these nations generally lack presence.

”There is a need for S&DT in the form of carve-outs for low income, resource-poor and livelihood fishing or fishing related activities up to coastal Members EEZ – exclusive economic zone – (200 nautical miles),” India has said.

FTA between India and UAE holds huge potential for both countries: Piyush Goyal

The proposed free trade agreement between India and the United Arab Emirates (UAE) holds huge potential for both the countries to boost trade, investment and the investors here are extremely keen to invest in the country, union minister of commerce and industry Piyush Goyal said in Dubai on Friday.

Addressing a press meet during the occasion of the Dubai Expo 2020, Goyal said the FTA will be a win-win for both the countries. Last month, India and UAE formally launched negotiations on FTA which is termed as Comprehensive Economic Partnership Agreement (CEPA) and likely to be signed by next year March.

“The UAE is a gateway to all of Africa and many other parts of the world. UAE also has a huge Indian diaspora, has a huge market for products like textiles, gems and jewellery, leather, footwear, and food products, which are labour oriented and provide economic opportunities,” said Goyal.

While India-UAE trade has also been impacted by the pandemic, it was valued close to $60 billion in 2019-20 with UAE being India’s third-largest trading partner, and UAE being India’s second-largest export destination after the US, with an export value of approximately $29 billion in 2019-20. UAE is also the eighth largest investor in India, having invested $11 billion between April 2000 and March 2021.

Prime minister Narendra Modi in a virtual address at the India Pavilion in the Dubai Expo 2020 said the event will go a long way to build deep and historical relations between UAE and India, attract investment from across the globe in sectors like health, textiles, infrastructure and services apart from others.

The Dubai Expo 2020 is the largest event in the region post the pandemic which will continue for six months till March 2022. Modi said India is participating with one of the largest pavilions in the Dubai Expo which will showcase investment opportunities in the country.

The prime minister said the Centre has undertaken several reforms in the last seven years which will continue. “There is openness, opportunity and growth in India. Today, India is one of the most open countries in the world in learning, perspective and innovation. We want to invite everyone to invest in our nation and be a part of our growth story. India has a combination of legacy and start-ups,” he said.

Goyal said India will produce 30 crore Covid vaccines in October which is a global record, apart from the fact that the country is vaccinating almost one crore doses everyday. “Very soon we will reach the milestone of vaccinating every adult with two doses. The US is co-operating in a big way with 150 components required to manufacture vaccines,” he said.

The reporter was at Dubai Expo 2020 at the invitation of Ficci

( Originally published on Oct 01, 2021 )