Trade Policy Updates (From 1st March to 31st March 2019)
1) The Cotton Corporation of India (CCI) has commenced the sale of cotton procured by the agency in the current marketing season under the government’s Minimum Support Price (MSP) procurement programme.
2) Ministry of Commerce in India has introduced an online system for exporters to obtain export licence for restricted category goods, a move aimed at promoting paperless work and ease of doing business.
3) The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is expected to help Vietnam continue speeding up its reforms in order to tap opportunities and deal with challenges from the deal.
4) UAE and Uzbekistan, both countries agreed to enhance economic, trade and technical cooperation based on a number of policies and programmes, including a range of priority sectors of shared interests.
Most notably, the UAE and Uzbekistan agreed to increase trade exchange volume and investments in various sector including textiles.
5) The U.S. and Korea have reached preliminary agreement on proposed modifications to the KORUS rules of origin for the some textile and apparel goods.
6) The Central government has decided to reduce royalties paid by Indian seed companies to Monsanto for its genetically modified (GM) cotton by 49% to INR 20 for a packet of 450 gm which was INR 39 earlier, according to a farm ministry order.
7) In a move towards paperless transactions between the Customs department and the trade, the Central Board of Indirect Taxes and Customs (CBIC) is replacing paper copies of Bill of Entry (import goods declaration) and Shipping Bills (export goods declaration) with electronic versions.
8) In India, previously the maximum rate of RoSL for apparel was 1.7% which has been revised to a maximum of 3.6%. The rate of central levies was a maximum of 2.45% which means effectively the rate on apparel has gone up from 1.7% to 6.05%.
For made-ups, previously the maximum RoSL rate was 2.2% which has been revised to 5%, plus central levies with a maximum rate of 3.2%, taking the overall rate from 2.2% to 8.2%.
9) The Union Cabinet of India on Thursday approved a scheme for rebate of all state and central embedded levies for apparel and made-up textile segments, which would make shipments zero-rated, thereby boosting the country’s competitiveness in export markets.
10) The US decision to withdraw the tariff concessions made available to India under the Generalised System of Preferences (GSP) has prompted the Commerce Ministry to deliberate upon whether it should finally impose retaliatory duties on US goods that it had announced in June 2018 but deferred several times.
11) Bangladesh and Russia have reportedly decided to sign a Memorandum of Understanding (MoU) to remove all trade barriers between the two countries.
There are currently no banking transactions between Bangladesh and Russia, and trade is done through Telegraphic Transfer (TT), which as per many garment makers, is a major hindrance towards facilitating garment business with Russia.
12) The Government will slash Britain’s trade tariffs to more than at any point in history if the UK leaves the European Union without a deal.
The Department for International Trade (DIT) intends to cut 80-90% of all tariffs imposed on goods imported into Britain.
13) The Central Bank of Nigeria (CBN) has placed foreign exchange restrictions on importers of textile materials with immediate effect. The measure is part of efforts to encourage the development of the country’s textile industry. The apex bank has also resolved to provide financial support for cotton producers at single-digit interest rates.
14) Indonesia and Australia on Monday signed a long-awaited trade deal after months of diplomatic tension over Canberra’s contentious plan to move its embassy to Jerusalem.
Greater access to the Australian market is expected to spur Indonesia’s automotive and textile industries.
15) The renewed free trade agreement between China and Chile, signed in 2017, took effect on 1st March 2019.
According to the agreement, China will gradually eliminate tariffs on some wood products from Chile within three years, and Chile will immediately eliminate tariffs on Chinese goods including textiles and clothing.
16) The duty-free status available to 3,500 Indian goods exported to the US market will end soon as the Trump administration has decided to withdraw the benefits extended to the country under the Generalised System of Preferences (GSP).
The concession has been rolled back on the grounds that India is not providing equitable market access to American businesses. The US is also terminating Turkey’s designation as a beneficiary of the scheme.
17) The U.S. has confirmed the country is postponing “until further notice” a scheduled tariff increase on Chinese goods, the latest sign that the world’s two largest economies could be headed toward a de-escalation of their trade dispute.
18) The United States Trade Representative’s office (USTR) has released language to delay a scheduled hike in tariffs on US$ 200 billion worth of Chinese goods, due to be published in the Federal Register next week.
19) Union Minister Smriti Irani Thursday launched a scheme for development of knitting and knitwear sector under PowerTex India, which will be in operation upto March 31, 2020.
The Ministry has approved combined SFC (Standing Finance Component) of PowerTex India Scheme and Knitwear Scheme with an outlay of Rs 487.07 crore.
20) Bangladesh is likely to sign a MoU with Russia to boost exports, especially in apparels.
The country has also been looking at Russia for quite some time as a potential export destination for readymade garments.