NTBs

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NTBs PTBs In SAFTA

• By
• B. Bhattacharyya
• Distinguished Professor
• Director IILM

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SAFTA shall involve the free movement of goods,
between countries through, inter alia, the
elimination of tariffs, para tariffs and
non-tariff restrictions on the movement of goods,
and any other equivalent measures
Article 3 (D)
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Article 6

• SAFTA may, inter-alia, consist of arrangements
  relating to
• Tariffs
• Para-tariffs
• Non-tariff measures
• Direct trade measures

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Article 7.4

• Trade Liberalisation Programme
• The Contracting States shall notify the SAARC
  Secretariat all non-tariff and para-tariff
  measures to their trade on an annual basis. The
  notified measures shall be reviewed by the
  Committee of Experts, established under Article
  10, in its regular meetings to examine their
  compatibility with relevant WTO provisions. The
  Committee of Experts shall recommend the
  elimination or implementation of the measure in
  the least trade restrictive manner in order to
  facilitate intra-SAARC trade.

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Article 7.5

• Contracting Parties shall eliminate all
  quantitative restrictions, except otherwise
  permitted under GATT 1994, in respect of products
  included in the Trade Liberalisation Programme.

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Evaluation

• Provisions on NTBs/PTBs weak
• QR elimination is on but no time limit
• AFTA time limit for these is 5 yrs.
• Database on NTB/PTB weak. So notification system
  will also be less effective.

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Follow-up pursuant to Article 7.4

• Meeting of COE SMC was held at Dhaka in April
  2006.
• Focus on NTBs. A sub group on NTBs/PTBs formed to
  identify, review and recommend steps for their
  removal through both bilateral regional
  consultations.

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Indian perspectives on NTBs

• Kamal Nath in a meeting with Bangladesh. NTBs are
  there not by design but by default.
• Jairam Ramesh in Dhaka
• We are committed to remaining the NTBs over a
  period of time. The NTBs will be identified, they
  will be removed.

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Extent of NTBs in Intra SAFTA Trade

• Hard data on NTBs for this trade segment are
  scarce.
• A World Bank study shows that QR restrictions had
  declined in all SAARC countries and are presently
  insignificant in Pakistan and Sri Lanka

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• Intra-SAARC agriculture trade is large and
  growing. NTBs mostly are pervasive here all over
  the world. These are also very difficult to
  identify and remove.
• Trade/industry has an important role to play in
  identifying non-transparent measures, all of
  which may not necessarily turn to out to be
  barriers.

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• With gradual shifting of unofficial trade to
  official trade, the issue of NTBs will become
  more important, and also visible.
• Cost of compliance will also become higher.
• Will tariff reduction be enough of an incentive?

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Way Forward

• Mutual recognition of
• Standards
• Certification
• Use SAARC Chamber Associate Chambers for NTB
  inventory.
• Analyze TRAINS Data and evaluate the extent of
  barriers at academic level
• Prioritize the NTBs for elimination