Sunitha Raju Sunitha Raju Professor and Chairperson Professor and Chairperson Indian Institute of Foreign Trade Indian Institute of Foreign Trade New Delhi. New Delhi. Implications of RTAs on the Implications of RTAs on the Competitiveness of Indian Competitiveness of Indian Agricultural Exports Agricultural Exports
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Sunitha Raju Professor and Chairperson Indian Institute of Foreign Trade New Delhi. Implications of RTAs on the Competitiveness of Indian Agricultural.
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Sunitha RajuSunitha RajuProfessor and ChairpersonProfessor and Chairperson
Indian Institute of Foreign TradeIndian Institute of Foreign TradeNew Delhi.New Delhi.
Implications of RTAs on the Implications of RTAs on the Competitiveness of Indian Competitiveness of Indian
3. Competitive products share low or non existent : cut flowers, edible vegetables, sugar, dairy, preparation of cereals
These trends imply that India is able to maintain export competitiveness in primary and semi processed products
Sustaining Export Markets
1. Traditional markets are declining or stagnant . (Fish, Cereals Coffee, Tea and Black pepper).
2. Export markets expanding for products diversified into value added exports. (Fish, Coffee, Black Pepper, Oil Seeds and Processed Food).
3. In traditional markets, India is loosing market share to competing suppliers. China (Fish, Ground Nut, Liquour, Vegetable) Vietnam (Vegetables, Cashew Nut, Pepper) Sri Lanka (Tea) EU and USA (Tobacco Products)
ASEAN-India Agricultural Trade Characteristics
Year Exports ImportsTotal Trade
(Export+ Import)Trade
BalanceExport/Import
Ratio
1. India's Trade with ASEAN
2000 880.00 1101.10 1981.10 -221.10 0.80
2003 1208.60 2264.90 3473.50 -1056.30 0.53
2006 1853.70 2040.57 3894.30 -186.90 0.91
2008 3811.09 3740.00 7552.00 71 1.02
2. ASEAN's Trade with India
2000 1296.60 832.15 2128.75 464.45 1.56
2003 1852.00 1049.35 2901.39 802.69 1.76
2006 1769.80 1623.38 3393.19 146.42 1.09
2008 1135.45 2056.14 3191.59 -920.69 0.55
Source : WITS Comtrade Database Note : Agricultural products includes HS chapter 1-24, 40 and 52
(US Mil $)
India’s Export to ASEAN having Increasing Shares
(US Mill. $)
India’s Export to ASEAN India’s Export to World
Code 2000 2006 2000 2006
Dairy Products (04) 2.49 (5.39)
14.89(8.36)
46.27 178.11
Edible Vegetables (07) 29.65(11.02)
80.34(12.91)
269.09 622.35
Edible fruit (08) 8.91(1.46)
21.08(2.40)
608.54 878.45
Tea, spices and coffee(09) 23.26(2.67)
138.61(11.64)
870.84 1190.98
Oilseed (12) 82.60(24.40)
176.35(33.14)
338.58 532.20
Vegetable preparations (14) 0.25(1.35)
1.32(5.02)
18.66 26.30
Cereal preparations(19) 3.10(7.80)
12.22(9.22)
39.78 132.47
Edible Preparations(21) 6.09(4.84)
12.94(6.60)
125.89 195.96
Tobacco(24) 10.93(5.65)
56.20(15.12)
193.60 371.74
Natural Rubber (40) 41.8(11.33)
115.7(9.72)
368.7 1190
Cotton (52) 130.05(5.2)
287(7.8 )
2445.50 3916.82
Source : WITS Database Note : Figures in the brackets are ASEAN’s share in India’s export to the World
India’s Major Export to ASEAN
Product Categories
Product Codes Product Description
India’s Export to ASEAN (Million $)
2003 2006
MeatProducts (02)
20210, 20220, 20230Carcasses, Bovine Animals, Fresh Or Chilled, and Others
134.95 194.74
FishProducts (03)
30374, 30379, 30613, 30614, 30624
Flat Fishes, Tunas, Livers, Mussels, Not Frozen and Others
75.02 59.56
Ediblevegetables (07)
70310, 70320Chickpeas, Beans, Cassava and Sweet Potatoes
37.89 73.68
Coffee and Tea Products (09)
90411, 90412, 90420, 90920, 90930,
90950Tea, Spices, Coffee Roasted 19.21 107.22
Cereals (10) 100510,100590, 100610, 100630Maize seed, Rice in the husk, milled rice
2.2. Tariff lines under Tariff lines under Normal Track Normal Track more than more than ExclusionExclusion & & SensitiveSensitive
Food residues, Cereal preparation, Sugar & Food residues, Cereal preparation, Sugar & confectionary, Fish preparationconfectionary, Fish preparation
3.3. Equal distribution of tariff lines under Equal distribution of tariff lines under Normal TrackNormal Track and and Exclusion & SensitiveExclusion & Sensitive
Natural Rubber, Styrene, Transmission belts, rubber used on aircraft, Gaskets, washers, Vulcanized rubber, rubber thread
12 88 -
Source: - Calculation based UNCTAD Comtrade Database Note- figures in the brackets are ASEAN’s share in India’s Import from the world. Products code in Bold are Sensitive and Exclusion listed, in normal
are NT1 and NT2, and Italic are other products
Is There an Import ThreatIs There an Import Threat
EL & SL account for 88% import of Rubber, 34% for Food EL & SL account for 88% import of Rubber, 34% for Food residues, 36% for Cocoa products, Coffee, Tea & Spices : 43%residues, 36% for Cocoa products, Coffee, Tea & Spices : 43%
NT1 & NT 2 account for 99% of imports of Edible Vegetables NT1 & NT 2 account for 99% of imports of Edible Vegetables and Fruits.and Fruits.
Tariff reduction nominal for Coffee, Tea & Spices; Oilseeds.Tariff reduction nominal for Coffee, Tea & Spices; Oilseeds. Tariff reduction for products which do not threaten food security Tariff reduction for products which do not threaten food security
1. 1. Most rising imports placed under EL. Thus, duty Most rising imports placed under EL. Thus, duty concessions have no significant impact concessions have no significant impact
2. Imports of Tea, Coffee, Spices are rising from World and 2. Imports of Tea, Coffee, Spices are rising from World and ASEAN because of Advance License scheme. Will ASEAN because of Advance License scheme. Will continue to rise in post-FTA periodcontinue to rise in post-FTA period
3. For Natural Rubber, the duty structure does not deviate 3. For Natural Rubber, the duty structure does not deviate from the existing trendsfrom the existing trends
4. With respect to Edible Oils, there is a need to take 4. With respect to Edible Oils, there is a need to take comprehensive view of imports under other FTA’s comprehensive view of imports under other FTA’s particularly ISLFTAparticularly ISLFTA
5. Export potential opportunities exist but would require 5. Export potential opportunities exist but would require developing export competitivenessdeveloping export competitiveness
INDIA - SRI LANKA FTA
Duty Concessions under ISLFTA
Duty Concessions for Sri Lankan Exports to India
Tariff Reduction Tariff Lines Remarks
1998 2005
100% 1351 4150
50% 2799 0 To be made duty free from 2004
50%-Tea 5 5 50% fixed tariff concession for imports of tea from Sri Lanka (Annual maximum quota of 15 million Kilograms)
50%-Garments 233 233 Garments covering Chapters 61 & 62 while remaining in the negative list, will be given 50 percent tariff concessions on a fixed basis, subject to an annual restriction of eight million pieces, of which six million shall be extended the concession only if made of Indian fabric. On utilization of the unrestricted quota, an additional quota of 2 million pieces out of 8 million pieces is permitted. The quota level per category is increased from 1.5 million to 2 million pieces per category per year.
25%-Textiles 528 528 Concessions of Textile items restricted to 25 percent on Chapters 51-56, 58-60, & 63. Four Chapters under the Textile sector retained in the negative list (Chapters 50, 57, 61, and 62)
0% 196 196 Negative List
Contd….
Duty Concessions for Indian Exports to Sri Lanka
Tariff Reduction
Tariff Lines Remarks
1998 2005
100% 319 1208
50% 889 0
35% 2724 2724 Subject to 70% tariff reduction in 2006, and 100% in 2008
0% 1180 1180 Negative List
Duty Concessions under ISLFTA
Source: Kelegama and Mukherji, 2007
ISLFTA: Comparison of Average Agricultural Imports from Sri Lanka and
World ('000 US$)
Commodity Group 1993-94 to1999-2000
2000-2001 to2005-06
1993-94 to1999-2000
2000-2001 to2005-06
Imports from SL
Imports fromSL
Imports fromWorld
Imports from World
I. Duty Free 173.3(0.08%)
207.5(0.04%)
207741.4 490071.4
02 Meat & Edible Meat 0 0 112.5 161.4
06 Live Trees & Other Plants 0 0 4215.7 1900
07 Edible Vegetables 255 105 216825.7 460304.3
14 Vegetables Products 3.3 0 985.7 2240
II. Concessional List 12158.6(0.88%)
63338.6(1.81%)
1379944.2 3490882.8
03 Fish & Crusta Nil 56.7 5944.3 11247.1
05 Products of Animal Origin 367.1 518.6 5858.6 12201.4
08 Edible Fruits 1508 2011.4 321291.4 478380
09 Coffee, Tea, Mate & Spices 3638.6(12.5%)
24028.5(21.6%)
29207.1 111067.1
11 Products of 5 82.9 Nil 9210
12 Oilseed & Oleaginan 227.1 768.6 14800 41775.71
13 Lac, gum 665.7 1085.7 24467.1 35225.71
Contd….
Commodity Group 1993-94 to1999-2000
2000-2001 to2005-06
1993-94 to1999-2000
2000-2001 to2005-06
Imports from SL
Imports from SL
Imports from
World
Imports from World
15 Animal & Vegetable fats 1845.7(0.3%)
29457.14(1.5%)
666961.4 2020749
18 Cocoa & Cocoa Products 50 58.5 5521.4 14750
19 Preparations of Cereal 63.3 135.7 28324.2 19120
20 Preparation of Vegetable Products
20 11.4 1192.8 14398.57
21 Miscellaneous edible 0 51.4 50201.4 34477.1
23 Residues & wastefrom food indus.
16.6(0.06)
804.2(1.4%)
26747.1 58694.2
24 Tobacco products 40 15 3411.4 10901.43
40 Rubber Products 3360 4205.7 233877.1 445810
III. Negative List 3380(1.39%)
4247.1(0.46%)
243382.9 924494.3
22. Beverages & Spirit 28 41.4 9505.7 68210
40 Rubber Products 3360 4205.7 233877.1 445810
IV All agricultural Products 15612.9 (0.85%)
67645.7(1.53%)
1845354.2 4414125.7
ISLFTA: Comparison of Average Agricultural Imports from Sri Lanka and
World ('000 US$)
Sri Lanka's Import from World and India (Neg. list prepared by Sri Lanka
Code 2001 2003 2005
World India World India World India
Meat Products (02) 3.15 0.02 3.46 0.00 3.25 0.00
Fish Products (03) 95.22 0.00 94.80 0.02 103.56 0.15