India stands to gain significantly from its proposed free trade pact with Oman, particularly in sectors such as petroleum, steel, electronics and textiles, as over 80 per cent of its exports to the country currently face a five per cent import duty which could be eliminated, according to an analysis by research body Global Trade Research Initiative (GTRI).

 

The Commerce & Industry Ministry is taking inputs from various stakeholders to strengthen its negotiating stance for the India-Oman Comprehensive Economic Partnership Agreement (CEPA) that could significantly boost exports to the country annually valued at $4.3 billion, a source tracking the matter told businessline.

 

'The Commerce Department has begun negotiations with Oman on a bilateral CEPA and is simultaneously continuing its consultations with line-Ministries and other stakeholders to ensure that it gets the most out of the pact,' the source said.

 

Reduction/elimination in import duties under the CEPA will benefit a vast majority of Indian exports to Oman, as over 83.5 per cent of India’s goods exports, totalling about $3.7 billion, currently face a five per cent import duty in Oman, the GTRI analysis noted. GTRI is founded by Ajay Srivastava, trade expert and former Indian Trade Service officer.

 

'With the new FTA (with Oman), these products, including major exports like motor gasoline ($1.7 billion), Iron, Steel and products ($235 million), Electronics ($135 million), Machinery ($125 million), aluminium oxide ($126 million), textiles and garment ($110 million), alumina calcined ($105 million), plastics ($64 million), boneless meat ($50 million), essential oils ($47 million), ferro silico manganese ($43 million), paper, board ($30 million), motor cars ($28 million), will benefit from duty elimination,' per the report. 

 

India’s merchandise imports from Oman, at $7.9 billion in 2022-23, also stand to benefit from the free trade pact. Key imports from the country include petroleum products ($4.6 billion) and urea ($1.2 billion), which account for 73 per cent of imports, while other significant imports comprise propylene and ethylene polymers ($383 million), pet coke ($265 million), gypsum ($115 million), organic and inorganic chemicals ($417 million), iron and steel ($62 million) and unwrought aluminium ($95 million), it pointed out.

 

However, most of these imports are raw materials and input to industries, and India has opened most such imports from other FTA partner countries, the analysis further noted.

 

'The India-Oman CEPA, while offering direct economic benefits through import duty reductions, also serves a larger strategic role in India’s foreign policy. While acknowledging the limitations set by Oman’s smaller economic size and population, the agreement’s true value lies in its potential to open doors for India in the Middle East, fostering economic and strategic ties in a region of critical importance,' it stated.

Department of Animal Husbandry and Dairying, Government of India is implementing 'National Programme for Dairy Development (NPDD)' scheme across the country since Feb-2014, with an objective of creating/strengthening of infrastructure for Production of quality milk, Procurement, Processing and Marketing of Milk & Milk Products. The scheme has been restructured/realigned in July 2021, for implementation from 2021-22 to 2025-26 with a total budgetary allocation of Rs1790 crore having two components:

 

Component 'A' focuses towards creating/strengthening of infrastructure for quality milk testing equipment as well as primary chilling facilities. Component 'B' (Dairying through Cooperatives) aims to increase sales of milk and milk products, upgrading dairy processing facilities and marketing infrastructure and enhancing the capacity of producer-owned institutions.

 

An amount of Rs 345.93 crore has been allocated (Budgetary Estimate) under both Component 'A' and Component 'B' (Dairying through Cooperatives) of the scheme during 2023-24.

 

Under Component A of the scheme, 195 projects in 30 States/UTs have been approved with the total outlay of Rs 3311.10 crore (including Central Share Rs 2479.06 crore). A total amount of Rs.1824.60 crore has been released to States for the implementation of these projects against which Rs. 1429.62 crore has been utilised. Under Component B of the scheme, 22 projects in 8 States have been approved with a total outlay of Rs 1130.63 crore.

 

A total amount of Rs 84.02 crore has been released to National Dairy Development Board for the implementation of the projects. About 16,794 dairy cooperative societies have been organized/revived, 30,066 Automatic Milk Collection Unit have been installed and about 82 dairy plants have been strengthened with creation of 24.00 lakh litres per day additional/new milk processing capacity under the scheme.

After India removed 'retaliatory import duty' on US apples in September, imports of American apples have surged 40 times in three months, while traders are hopeful of regaining market share. In 2017-18, the import of US apples was a record of over 7 million boxes, which dropped to 50,000 boxes in the 2022–23 (September–August) season.

 

In a promotional event event in New Delhi on Tuesday, Sumit Saran, country representative of Washington Apple Commission, said: 'We are hopeful to regain our market share. Apart from metros, we see a lot of sales in tier I and tier II cities. We do not promote when Indian production is in market. We wait till domestic production exhausts by January so our product can be from February.' The main sales period of US apples in India continues until July.

 

Saran said Washington apples had a kind of gone out of Indian market due to 'retaliatory tariff' of additional 20 per cent over and above basic import duty of 50 per cent imposed in 2019 in retaliation to section 232 of US government’s higher import tax on Indian steel and aluminium.

 

Creating a void

Though India announced to withdraw additional duty on US apples in June, the notification came only on September 6.

 

Claiming that the non-presence of Washington apples created a void both for traders and consumers, Saran said that 70 per cent duty was huge for the trade to compete with other origins that were paying 50 per cent duty.

 

Between September 1 and November 30, 440,000 boxes (of 20 kg each) have been imported, as against only about 10,000 boxes in the year-ago period, he said. In entire 2022-23 (September-August), India had imported 50,000 boxes of apple from the US whereas prior to the additional duty levied, the annual import by India was about 5 million boxes, he added.

 

The US was very concerned about the fall of its apple export to India as in 2017 India had becomes its second biggest export destination for apple, globally. Even in the domestic market it had 53 per cent share in the imported apple segment. Turkey, Iran, Italy, Chile, Poland are some of the main destinations from where Indian traders import.

 

Total imports of apples by India dropped to 3.74 lakh tonnes (lt) in 2022-23 from 4.59 lt in 2021-22, official data show. In 2027-18, import of apple was 2.58 lt.

 

Philip Green OAM highlighted a remarkable two-way trade that has grown by more than 50 per cent over the past five years.

 

Lauding the bilateral partnership between New Delhi and Canberra, the Ambassador of Australia to India, Philip Green OAM highlighted a remarkable two-way trade that has grown by more than 50 per cent over the past five years, adding that India is the most consequential relationship.

 

Emphasizing India's paramount significance in their bilateral relations, he expressed his commitment to proactive engage during his tenure and said that, as Australia's 22nd High Commissioner to India, he is 'here to get things done.'

 

In his keynote address at the Asia Society Policy Institute, here in the national capital, the Australian Ambassador to India said, 'For me, assuming this role as Australia's 22nd High Commissioner to India is the pinnacle of his career. India is the most consequential relationship, at the most critical moment, I have ever worked on. It is a privilege for me to be here today.'

 

Affirming his dedication to advancing the partnership between the countries and echoing the directive he received from the Prime Minister to propel the relationship to new heights, he said,'Our relationship is at the highest point in our history. But I'm not here to rest on laurels. I'm here to get more things done. I'm here to drive the relationship further and to drive it faster. That's what the Prime Minister told me to do when he sent me here.'

 

Asia Society Policy Institute, notably a division of Asia Society India Centre, is a think-and-do tank designed to bring about changes that incorporate the best ideas from top experts in Asia and to work with policymakers to integrate these ideas and put them into practice.

 

Speaking further, the Australian envoy also talked at length about India-Australia trade ties, the Indo-Pacific and QUAD (Quadrilateral Security Dialogue).

 

'On the economic front, our two-way trade has grown by more than 50 per cent in the last five years. And last year, we signed the landmark Economic Cooperation and Trade Agreement (ECTA). This deal has provided the momentum for negotiations towards an even more ambitious goal: a Comprehensive Economic Cooperation Agreement or CECA,' he said.

 

Highlighting the role of Quad, he said that there is a big comparison in how it used to be earlier and how things progress under the grouping now.

 

'Quad in 2019 meant loose, informal meetings of officials in the margins of multilateral gatherings. No fixed agenda. Sometimes, no substantive statement. Those discussions, to be frank, largely centred on whether and how the Quad should become the Quad--Contrast that to what we see now-- We have delivered three Quad Leaders' Summits. Leaders, as well as Ministers. In addition to a proliferation of Senior Officials' meetings,' the envoy said.

 

Despite the change in plans regarding President Biden's visit to India, the envoy affirmed Australia's ongoing collaboration with India and other QUAD partners to facilitate a Summit next year.

 

'And while today's news is that President Biden is unable to travel to India in January, Australia will continue to work closely with India and its other partners to support its efforts to host a Quad Leaders' Summit next year. In only a few years, we've developed a shared vision, a positive agenda, and we're getting stuff done, he added.

 

Green also emphasised that India and Australia see the Indo-Pacific region the 'same way' and 'share same goals.'

 

He said, '...And if India and Australia want to preserve an open, stable and prosperous Indo-Pacific, we need each other. We see the region the same way, we share the same goals, and we both know what needs to be done. This is what strategic alignment looks like: a mission to work together.'

 

He further noted that Australia is investing in its network of strategic partnerships and added that India is an indispensable partner.

 

'Australia is investing in our network of strategic partnerships. We know that when countries pool their resources and combine their strengths, that is a decisive competitive advantage. And India is an indispensable partner, critical for achieving the sort of strategic equilibrium that we need,' Green said.

 

Highlighting how India and Australia's defence ties are at their pinnacle currently, Green said, 'For the first time this year, we welcomed an Indian submarine to dock in Australia, and we welcomed visits by two Indian military aircraft to the Cocos (Keeling) Islands.'

 

He also said that sense of partnership was on full display last month at our second Foreign and Defence Ministers' 2 2 Meeting in Delhi.

 

'Our Ministers agreed to an ambitious set of outcomes, including expanding the scope and complexity of our joint military exercises and continuing the deployment of aircraft from each other's territories to enhance shared maritime domain awareness. We also decided that our diplomats should be working more cohesively in the Indo-Pacific region. It is a necessity that drives Australia and India to work together, in combination with other nations, to enhance our collective security and prosperity,' the envoy said.

 

Green also stated that he wants a Comprehensive Economic Cooperation Agreement (CECA) that expands the range of goods available in India and also gives a boost to Indian supply chains.

 

'I want us to have a Comprehensive Economic Cooperation Agreement that expands the range of goods available in India, strengthens Indian supply chains, and advances its green transition. ECTA already gets us some of the way there. 96 per cent of Indian goods now enter Australia duty-free, and 85 per cent of Australian goods now enter India without tariffs,' the envoy said.

 

'Our companies have noticed and are benefiting. India's utilisation rate for goods under our agreement is 77 per cent--around triple what it is for some of India's other free trade agreements. We have seen Australian imports of India's agricultural goods increase by 16 per cent, and imports of Indian apparel increase by 9 per cent. Our CECA agreement will take this even further and faster to deliver for Australian and Indian businesses,' he added, underlining that there have been some good rounds of negotiation that have taken place.

 

'We have had some good rounds of negotiation. We have a lot of text settled. We know India is focused at present on getting to the finish line with the UK. We are ready to conclude our second phase in due course, but our focus will be on ambition--a good deal, not any deal,' the Australian envoy said.

 

The India-Australia Economic Cooperation and Trade Agreement (IndAusECTA) came into effect on December 29, 2022. The ECTA was signed on April 2, 2022, and ratified on November 21.

 

Written notifications were exchanged on November 29 and after 30 days, the agreement came into force.

 

India and Australia implemented an economic cooperation and trade agreement (ECTA) and are now negotiating the expansion of its scope for the CECA.

The Production Linked Incentive Scheme for Food Processing Industry (PLISFPI) was approved by the Cabinet on March 31, 2021, with an outlay of Rs 10,900 crore, to be implemented from FY 2021-22 to FY 2026-27. The scheme consists of three components: incentivising manufacturing in four food product segments (Ready to Cook/ Ready to Eat foods; Processed Fruits & Vegetables; Marine Products; and Mozzarella Cheese), promoting Innovative/Organic products of SMEs, and incentivising branding and marketing abroad for promoting Indian brands in the global market.

 

Additionally, the PLI Scheme for promoting Millet-based Products was launched in the FY 2022-23 with an outlay of Rs 800 crore, utilising the scheme’s savings.

 

The PLI beneficiaries have reported investment of Rs 7,126 crore under the scheme, with sales of Rs 49,825 crore upto April-September 2023. According to scheme guidelines, the PLI beneficiaries are required to furnish incentive claims for a specific financial year by December 31, of the following financial year.

 

During the formulation of PLISFPI, proactive steps were taken to align it with global best practices and market demands. The process involved active engagement with various stakeholders, including industry experts, large-scale manufacturers and SMEs. An extensive consultative approach was adopted to gather inputs while formulating the scheme guidelines. This collaborative effort is continuing in form of regular engagements with the stakeholders for ensuring continued relevance and effectiveness of the scheme guidelines.

 

The scheme aims to generate employment for approximately 2.5 lakh persons. As of September 30, 2023, Quarterly Review Reports from PLI beneficiaries indicate the creation of employment for 2,37,335 persons.

 

India may allow the supply of 20,000 tonnes of refined sugar to Kenya, one of its strategic partners in Africa, overriding an export ban on the sweetener.

 

This will likely be permitted under the advanced authorisation scheme, a government official informed. Under AAS, refineries can import raw sugar and export refined sugar after value addition.

 

India, which surpassed Brazil in the 2021-22 season to become the world’s largest sugar producer and second-largest exporter, imposed export controls in October last year. This was later extended beyond October 2023 considering an expected decline in production.

 

'Although India will have sufficient availability for domestic consumption, there may not be any surplus quantity for exports due to anticipated lower production this year than the previous year,' said the official.

 

'Therefore, it has been suggested that the refineries that import raw sugar and export refined sugar after value addition under AAS, to export the quantity to Kenya.'

 

The external affairs ministry, the commerce and industries ministry, and the food and public distribution department did not immediately reply to queries on the matter.

 

AAS is not restricted under the sugar export policy and no separate permission is required from the government. The scheme allows duty-free import of raw materials that are to be incorporated in products meant for exports. 

 

The official quoted earlier said the ministry of external affairs has recommended exporting 20,000 tonnes of sugar via sea, a more cost-effective route, against Kenya’s request for 500,000 tonnes of the sweetener.

 

India supplies 10,376 tonnes of sugar on average to Kenya each financial year, according to commerce ministry sources. Earlier this month, the government allowed exports of 100,000 tonnes of non-basmati white rice to Kenya and 140,000 tonnes to four other African nations, overriding an existing ban. 

 

India’s sugar production in the 2023-24 season (October-September) is estimated to have dropped to 30-30.5 million tonnes, after diversion for ethanol, against domestic consumption of 27.5-28 mt. The country produced 32.7-32.8 mt of sugar in the year prior.

 

The lower output is due to the El Nino weather condition compromising monsoon rains in August, top-producing states Maharashtra and Karnataka hard. 

 

El Nino is anticipated to strengthen through 2023-24, which could lead to intensification of dry conditions during the next sugar season. This may lead to a further decline in sugar production during the 2024-25 season. 

 

As India nears the crucial general election in a few months, the government has escalated export curbs to stabilise prices amid a significant jump in food inflation. 

 

It recently asked sugar mills to not use cane juice to make ethanol and to ramp up production of sugar to make up for lower anticipated crop following patchy monsoons. Besides sugar, India has placed curbs on wheat, rice and onion exports. 

 

Food inflation, measured by the consumer food price index, which accounts for nearly half of the overall consumer price basket, rose to 8.70% in November from 6.61% in October and 6.62% in September because of a substantial rise in the prices of vegetables and pulses.

India has exported 26.08 lakh tonnes of basmati rice and 73.18 lakh tonnes of non-basmati rice during the April-October period of this fiscal year.

In a written reply to Lok Sabha, Agriculture Minister Arjun Munda shared export data of major foodgrains.

 

As per the data, the exports of basmati rice stood at 45.61 lakh tonnes in the entire 2022-23 financial year while the shipments of non-basmati rice stood at 177.92 lakh tonnes.

Exports of basmati rice stood at 44.15 lakh tonnes in 2018-19; 44.55 lakh tonnes in 2019-20; 46.30 lakh tonnes in 2020-21; and 39.44 lakh tonnes in 2021-22.

 

The data showed that exports of rice (other than basmati) were at 76.48 lakh tonnes in 2018-19; 50.56 lakh tonnes in 2019-20; 131.49 lakh tonnes in 2020-21, and 172.89 lakh tonnes in 2021-22 fiscal.

India's total rice production stood at 1,357.55 lakh tonnes in 2022-23 as against 1,294.71 lakh tonnes in the previous year.

Rice output stood at 1,164.84 lakh tonnes in 2018-19; 1,188.70 lakh tonnes in 2019-20; and 1,243.68 lakh tonnes in 2020-21 fiscal year.

The government has banned exports of broken rice and non-basmati white rice. The export of broken rice was prohibited and an export duty of 20 per cent was imposed on non-basmati white rice on September 9, 2022. Subsequently, the export of non-basmati white rice was also prohibited on July 20, 2023. Pulses Imports

 

India imported 19.63 lakh tonnes of pulses during April-October this fiscal to meet domestic demand, the government said on Tuesday.

In a written reply to the Lok Sabha, Agriculture Minister Arjun Munda informed that pulses imports stood at 24.96 lakh tonnes during 2022-23, 27 lakh tonnes in 2021-22, 24.66 lakh tonnes in 2020-21, 28.98 lakh tonnes in 2019-20 and 25.28 lakh tonnes in 2018-19.

The production of pulses stood at 220.76 lakh tonnes in 2018-19, 230.25 lakh tonnes in 2019-20, 254.63 lakh tonnes in 2020-21, 273.02 lakh tonnes in 2021-22 and 260.58 lakh tonnes in 2022-23.

India imports pulses mainly from Canada and Myanmar.

Union Commerce and Industry Minister Piyush Goyal held a meeting with the European Free Trade Association (EFTA) delegation led by Swiss State Secretary for Economic Affairs, Helene Budliger Artieda, and Norwegian Minister of Trade and Industry, Jan Christian Vestre, on Wednesday.

 

'Held a meeting with the European Free Trade Association (EFTA) delegation, led by Ms. Helene Budliger Artieda, Swiss State Secretary for Economic Affairs and Mr. Jan Christian Vestre, Norwegian Minister of Trade and Industry,' the union minister said in a post on 'X'.

 

During the meeting, Goyal discussed the progress of Free Trade Agreement (FTA) negotiations with EFTA nations and explored avenues to further strengthen partnerships across key sectors.

 

Recently, Piyush Goyal concluded a 'highly successful' meeting with a delegation from the EFTA, led by the Swiss State Secretary for Economic Affairs, Helene Budliger Artieda.

 

The meeting took place in London from July 11 to July 12. Helene Budliger Artieda was also accompanied by industry stakeholders from the pharmaceutical, machinery and electronics industries of the EFTA states.

 

The deliberations between Minister Piyush Goyal and State Secretary Helene Budliger Artieda 'were fruitful and detailed discussions on crucial issues, with the shared goal of swiftly concluding' the Trade and Economic Partnership Agreement (TEPA) negotiations, the commerce ministry said in a release.

 

The primary objective of these negotiations is to establish a 'fair, mutually beneficial, and comprehensive' trade deal between India and EFTA.

 

Over the past few months, India and EFTA have significantly intensified their engagement, highlighting the commitment of both parties to achieving an early conclusion to the TEPA negotiations.

 

The commerce ministry's release added that the meeting in London further bolstered this commitment, with both sides demonstrating a strong willingness to progress towards a final agreement.

 

Minister Piyush Goyal expressed his satisfaction with the progress made during the meeting, highlighting the constructive and collaborative nature of the discussions. He emphasised the importance of a comprehensive trade deal that addresses the needs and aspirations of both India and EFTA.

India-UK free trade agreement (FTA) will give a level playing field to Indian textile exporters and boost exports as heavy duties levied by the UK is a challenge for Indian exporters, said Rajeev Saxena, joint secretary, ministry of textiles on Wednesday.

'Indian exporters are facing challenges specially from Europe because they have to pay heavy duties as compared to Bangladesh and Vietnam.

These competing countries have an advantage over India. The India-UK FTA will give a level playing field to Indian exporters and will help exports grow significantly from India,' said Saxena on the sidelines of an event in Indore.

The negotiations over the FTA between India and the UK are still ongoing with the trade segment hoping for a quick signing off on the agreement that will give an easy and greater access to players to each other’s markets.

Saxena was in the city to participate in roadshow for Bharat Tex 2024, the first edition of the global textile expo to be held in New Delhi from February 26-29, 2024 and organised by a consortium of 11 textile export promotion councils and supported by the ministry of textiles with an aim to promote Indian textile industry and showcase the entire value chain of the sector to the world.

'India will aim to achieve $100 billion exports in textiles by 2030 and the growth is expected to come from the sunrise and traditional segment. The traditional India textile sector like handloom and handicraft are very much admired outside India,' said Saxena.

He said, the technical textile is a sunrise sector and a special scheme has been launched by the National Technical Textile Mission to support startups where grants of up to Rs 50 lakh is given to young entrepreneurs.

 

'Technical textiles are high value items and have a lot of potential in India as it covers everything right from infra to health. Much research work is done and prototypes are developed but they are not commercialised. Young entrepreneurs can seek help from the government of India and can develop products and markets in the world,' said Saxena.

He said, Madhya Pradesh is an important destination for textile and considering its importance, the government of India has sanctioned the PM Mitra Park in Dhar.

'PM Mitra Park in Madhya Pradesh will scale up the economy and the entire value chain can be consolidated and logistics cost could be reduced. MP has strength in spinning, manufacturing sector, handlooms, handicraft and has good availability of skilled labourer in textile,' said Saxena.

 

India on Tuesday deferred the mandatory requirement of a certificate of inspection by export inspection agencies for shipping both basmati and non-basmati rice to certain European countries by six more months.

 

Amending an earlier notification, the Directorate General of Foreign Trade (DGFT) said that export of rice (basmati and non-basmati) to EU member states and other European countries namely UK, Iceland, Liechtenstein, Norway, and Switzerland 'only' will require certificate of inspection from Export Inspection Council/Export Inspection Agency.

 

On May 29, 2023, the DGFT had announced the move for six months.

 

'Export to remaining European countries will not require a certificate of inspection by the Export Inspection Council (EIC)/Export Inspection Agency for export from the date of this notification for a period of six months,' the DGFT said in a notification Tuesday.

 

EIC is the official export certification body of India which ensures quality and safety of products exported from India.