With less than 10% tariff lines regulated, India working on 252 new standards

India is one of the most unregulated markets among major trading countries, with regulations on less than 10 per cent of its national tariff lines.

Compared to India’s 452 technical and sanitary standards notifications, the US has 8,105 notifications, China has a total of 2,900 notifications, Brazil has 3,913 notifications, the EU has 2,974 notifications; while Australia has 888 notifications in place, according to figures compiled by the Commerce Ministry.

Now, the government is working on new standards to redress the situation. It is considering 252 new technical regulations on items such as chemicals and pharmaceuticals, toys, footwear, sports good, telecom equipment and industrial equipment, which will apply on both imports and domestic manufacture, according to a government official.

“New technical regulations on 252 items are being considered by the Centre to be framed by the Bureau of Indian Standards. The Commerce Ministry is talking to different line ministries, including Chemicals and Pharmaceuticals, MeitY, Heavy Industry and DPIIT, and also specific regulators. Work has already been initiated on 67 items,” the official said.

Decreasing tariffs

While tariffs have been dropping across the world due to trade liberalisation, many countries have replaced these with non-tariff measures in the form of sanitary and phyto-sanitary (SPS) norms and technical barriers to trade (TBT).

Developed countries, which have very low average tariffs on goods, use thrice as many TBT measures as developing nations, according to Commerce Ministry figures. But India’s SPS and TBT measures are among the lowest compared even with its neighbouring South Asian and South-East Asian countries.

India has in place just 172 TBTs, while China has 1,516, South Korea 1,036, Thailand 809, the Philippines 294 and Malaysia 267. India’s SPS notifications are 261, while Thailand has notified measures on 387 items, the Philippines on 583, South Korea on 777, and China on 1,332 items.

Addressing the gap

To address the regulatory gap, India’s 11,559 national tariff lines (NTLs) were analysed and 526 of the items were prioritised for the formulation of technical regulations.

A ‘focus class’ of 371 tariff lines (accounting for 26 per cent of total imports valued at $127 billion) was prioritised and segregated into six major categories/sectors — steel, chemicals and pharmaceuticals, heavy industry, electronics & IT, telecom and DPIIT.

After an analysis of the items, it was concluded that on about 25 items no technical regulation was required while on 94, regulations were already formulated.

COMMENT NOW