Our Bureau

New Delhi, March 15

THE Federation of Indian Chambers of Commerce and Industry (FICCI) has urged for a three-pronged approach for tariff conversion procedures under the ongoing WTO negotiations in agriculture.

This is to give exports from developing countries effective market access under the Doha round and prevent developing nations from continuing with a high tariff regime, the chamber said.

The chamber has asked for enforcement of strict provisions to convert "specific" tariff into ad-valorem tariff with bound rates to minimise the misuse of tariff reduction commitments by the developed countries. While `specific tariff' is a tariff in which the custom duty is not related to the value of the imported good but to the volume and weight, the ad-valorem tariff is imposed as percentage of the value of good.

The chamber also felt that in the absence of proper provisions for converting the `specific tariff' into the `ad-valorem tariff', tariffs against the developing country products in the developed countries could continue to be high and prohibitive.

In order to prevent developed countries from continuing with such high tariffs, FICCI has argued for a system of `verification' and `challenge' to check the conversion of specific tariff into ad-valorem tariff by any member country. However, countries such as Japan, Switzerland and other EU members are pushing for a flexible approach to the issue without any cumbersome verification procedures.

(This article was published in the Business Line print edition dated March 16, 2005)
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