WTO reviews India’s trade policy
8 June, 2015
India’s trade policy is under review by the WTO for the sixth time. According to the report by the WTO’s Secretariat, though India continued its efforts to liberalize and facilitate trade, its tariff structure remains complex. It further states that the trade regime is less predictable as constantly notifications are being issued by DGFT and Customs to attain short-term objectives. The report accepts India as a strong advocate of multilateral trading system but makes a mention about India’s 15 regional trade agreements currently in force. India’s recently released new Foreign Trade Policy 2015-20 with the aim to raise its share of global exports to 3.5% by 2020, is also discussed in the report, which further mentions that though around 97.6% of India’s imports were processed through the risk management system, India's import regime remains complex, particularly the licensing and permit system.
On the positive side for India, noting that the recent decrease in the current account deficit has been financed through large capital inflows, both foreign direct and portfolio investment, the report observes that India’s merchandise trade deficit has been decreasing while services trade surplus continues to increase. In sphere of IPR laws, it is noted that India has taken several initiatives to modernize its IPR administration and continue its efforts to enforce IPRs.
Indian Customs Tariff, with number of types of duties and process of determination of effective rate, was found to be complex by the report which also states that the average MFN tariff rate has risen recently while percentage of duty-free lines has declined slightly.