Soon, government portal to reduce non-tariff barriers for trade, traceability for food products

The Union Commerce Ministry is likely to roll out a portal in the next 2 to 3 months for exporters to point out non-tariff barriers which are impeding the growth of exports from India.

A task force constituted under the leadership of Additional Secretary (Commerce) Rajesh Agrawal is looking into designing the portal, and is also going to take up relevant issues with foreign nations.

Non-tariff barriers include Technical Barriers to Trade (TBT) and Sanitary and Phytosanitary Measures (SPS) which are often imposed by foreign countries to bar the import of several products.

TBTs include mandatory technical regulations, voluntary standards and conformity assessment procedures across agricultural and industrial goods, like regulations on the size and use of fertilizers in edible products.

Also Read: Global goods trade may grow the fastest in two years as inflation cools

SPS include basic rules for food safety to protect consumers from food-borne risks and animal and plant health requirements to protect from damage by pests or diseases.

While the WTO doesn’t recognise non-tariff barriers as a trade issue, traceability of origin continues to be a challenge for food products being exported as more and more countries are coming up with regulations in the domain.

Indian exports which usually face high non-tariff barriers comprise chillies, tea, basmati rice, milk, poultry, bovine meat, fish and chemical products to the EU; sesame seeds, black tiger shrimps, medicines and apparel to Japan; food, meat, fish, dairy and industrial products to China; shrimps to the US; and bovine meat to South Korea.

Explaining the gravity of the impact of non-tariff barriers on trade, Additional Secretary Rajesh Agrawal cited empirical studies which claimed that the impact of non-tariff measures on trade is more than tariff barriers as it adds to cost in quality improvement.

Also Read: India plans to push WTO to ease subsidy rules on grain purchase

However, there is no exact data on the quantum of exports adversely impacted by non-tariff barriers. He added that as tariffs go down across the world, technical issues are adding to the trade burden, and even LDCs (least developed countries) are also imposing technical regulations.

While the Indian government is confident that technology can successfully onboard every cog in the supply chain of edible products, Appropriate Levels of Protection (ALOPs) are another worrisome non-tariff barrier for exporters.

ALOPs are SPS which vary from one nation to the other for the presence of ingredients or impurities in traded products and the perceived level of harm to consumers in different countries.

For instance, the US allows the use of edible products to 7 mg/kg ppm of Ethylene Oxide (ETO) for fresh products, India allows 0.1 mg/kg ppm of ETO in spices and 0.01 mg/kg ppm ETO in other food products and the EU rejects all exports of edible products containing ETO over 0.01 mg/kg ppm.

Also Read: India opposes China-led investment facilitation proposal at WTO, calls it a non-trade issue

From 1995 till date, India has flagged 43 issues before the WTO’s SPS committee and 40 issues before the WTO’s TBT committee. Against India, 25 SPS issues and 70 TBT issues have been raised by other countries.