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INDIA : COMMERCE
Thursday, 24 May 2012 04:20

 

 

INDIA : COMMERCE


INSTITUTION

HEAD OFFICE

Coffee Board

Bangalore

(Statutory Board under Ministry of Commerce)

Rubber Board

Kotayam, Kerala

(Statutory Board under Ministry of Commerce)

Tea Board

Kolkata, 1st April 1948

(Statutory Board under Ministry of Commerce)

Tobacco Board

Guntur, AP, 1st Jan.

(Statutory Board under Ministry of Commerce)

Species Board

Kochi, Kerala 1stJan., 1948

(Statutory Board under Ministry of Commerce)

Indian Institute of Foreign Trade

New Delhi

(Registered Society and has been conferred ‘Deemed University Status’.)

Indian Institute of Packaging (IIP)

Mumbai

(It is a registered society)

Foreign trade has important role in the growth of Indian economy with exports majority include manufacturing goods (80%) and imports include capital goods and intermediates. During 2008-09 the value of India’s external trade reached Rs. 22,15,191 crore.

Trade Scenario during 08-09: India’s export achieved a value of US$ 168.7 billion registered growth of 3.5% against 29.1% in previous year with the slow down from September 08 onwards while it has shown growth of 31.3% during April – Sept. 08-09 with commodities group excluding marine products, handicrafts, and carpets whereas during Oct.-March. 08-09 a decline of 19.1% with all commodities resulting in negative growth.

Import has shown increase of 14.4% and its value reached to US$ 287 billion comprising oil import (16.9% higher than previous year) (US$ 93.2 billion) and non-oil (13.2% higher than previous year) (US$ 194.6 billion).

Trade deficit increased from US$ 88.5 billion (07-08) to US$ 119.1 billion.

During April-Feb., 08-09, the share of Asia and ASEAN region has shown growth and contributed 51.4% of total export where as share of Europe and USA contributed 23.8% and 16.5% respectively for the same. Country-wise, USA contributed 12% followed by United Arab Emirates (10.8%), China (5.1%), Singapore (4.7%), Netherlands (3.7%), Hong Kong (3.7%), U.K. (3.6%), Germany (3.4%), Saudi Arabia (3.0%), Belgium (2.6%) and Italy (2.2%). During 08-09, Asia and ASEAN region contributed 61.7% of India’s total imports followed by Europe (18.7%) and America (10.1%). Country-wise, share of China was 10.7% followed by Saudi Arabia (7.1%), UAE (6.4%) and USA (6.0%), Iran (4.3%), Switzerland (4.2%), Germany (3.6%), Kuwait (3.4%), Nigeria (3.2%), and Iraq (2.8%).

Exports 2009-10: During 2009-10 (April – February) major contribution in export is given by Engineering Goods (18.1%) followed by Petroleum products (15.70%), Gems & Jewellery (16.2%), Chemical including pharmaceuticals (8.8%) and Textiles (9.6%).

Imports 08-09: Major contribution in import is given by Petroleum Products (30%) followed by, Gold and Silver (9.5%), Machinery (7.8%), electronics goods (7.21%), Pearls, precious and semi precious stones (5.4%).

Export Promotion Measures: Export policies and strategies are monitored and formulated regularly. For year 09-14, Foreign trade policy mainly targeted two things: (i) Double the export of goods and services by 2014 and (ii) to double India’s percentage share of global trade by 2020 and to focus on the generation of additional employment.

Multilateral Trade Issues and Initiatives: Multilateral negotiations in the WTO cover Agriculture, Non-Agricultural Market Access, Services and several other areas such as Trade-related Intellectual Property Rights and Trade and Environment as part of a ‘single undertaking’. In the WTO, decisions on any issue are taken on the basis of consensus amongst its members.

A Mini-ministerial meeting of the WTO (Geneva, 21-29 July, 08) was held to discuss and finalize modalities for Agriculture and NAMA. Simultaneously, a meeting on Services Trade (a “Signaling” conference) was also held with the intention that once the Agriculture and NAMA modalities were finalized, the scheduling exercise alongwith negotiation in all other areas like services, rules trade facilitation etc. would be completed by the end of the year. However, the WTO meeting ended without any agreement. While in the last focus was entirely on the Special Safeguard Mechanism (SSM) for developing countries. In the agriculture negotiations, WTO Members discussed modalities to be used to cut traffic on agricultural products and subsidies. The main elements of the Agreement and negotiations on Agriculture (AOA) are: (i) market access, (ii) domestic support and (iii) export competition.

The Doha Ministerial Declaration of November 2001 committed Members to comprehensive negotiations aimed at – substantial improvements in market access; reductions of all forms of export subsidies; and substantial reductions in trade-distorting domestic support. Special and differential treatment for developing countries. India has been working constructively with her coalition partners in developing country groupings such as the G-20 and the G-23 in order to achieve an outcome in the agricultural negotiations that would fully reflect the level of ambition of the Doha mandate and the interests of developing countries. In the NAMA negotiations, India along with its coalition partners in the NAMA 11 has been negotiating for flexibilities that are both adequate and appropriate for protecting its sensitive sectors and nascent industries for the impact of tariff reductions or bindings. The negotiating mandate agreed by all the members of the WTO is contained in the Doha Ministerial Declaration of 14 November, 2011 which was further elaborated and complemented by the General Council Decision of 1 August, 2004 (the July Framework) and the Hong Kong Ministerial Declaration of 18 December, 2005. At Hong Kong, the Trade Ministers of the WTO Members has resolved to complete the negotiations in 2006. However, the negotiations were suspended on 24 July, 2006 and negotiations again resumed on 7 February, 2007. During the mini-ministerial meeting held in July 2008 to finalize Agriculture and NAMA modalities, a Signaling Conference on Services was also held. At the conference, India ‘signaled’ that it has already put an revised offer on the table and further response would depend on the response to that. The EC and the US also gave signals in their Mode 4 offers but signals were unambiguous in terms of the improvements being offered by them and modalities on the agriculture and NAMA could not be finalized. During the WTO’s Hong Kong Ministerial Meeting held in December 2005 it was decided that all developed countries, and developing countries declaring themselves in a position to do so, would provide Duty Free Quota Free market access for all products originating from all LDCs (least developing countries). In line with the above mandate, the Prime Minister of India launched Duty Free Tariff Preference (DFTP) Scheme to provide duty free and preferential duty access on 94% of India’s total tariff lines. To avail DFTP, the beneficiary countries have to submit letters of intent and details of agencies / officials authorized to issue the certificates of origin to the Government of India.

Technical level discussions have taken place through 2009 and 2010 but there has been no progress on substantive issues. At a stock taking exercise of negotiations held in the WTO in March, 2010, members in general expressed a willingness to continue working towards an early conclusion of the round based on established principles.

AUTONOMOUS BODIES

BOARD

CONSTSITUTED UNDER

IMPORTANT DEVELOPMENTS

Coffee Board

Coffee Act, 1942

It is the oldest Board under the Department of Commerce. The Board is headed by a Chairperson and functions from Bangalore. The Board administers four Regional Coffee Research Stations, a Coffee Research Institute, a number of Regional Field Stations and Coffee Demonstration Farms.

Rubber Board

Rubber Act, 1947

Headquarters at Kottayam and five Zonal Officers, thirty-nine Regional Office number of Field Stations, Rubber Development Centres and Regional nursery. It is headed by a Chairman.

Tea Board

Tea Act, 1953

Constituted as a statutory body on 1 April 1954 and is headed by a Chairman with head Office at Kolkata.

Tobacco Board

Tobacco Act, 1975

It was set up as a statutory body on 1 January, 1976 and the Board with headquarters at Guntur in Andhra Pradesh, is headed by a Chairman and is responsible for the development of the tobacco industry. The Board also has a Directorate Auctions at Bangalore. The primary functions of the Board include the regulating production and curing of Virginia Tobacco; keeping a constant watch on the Virginia Tobacco market in India and abroad.

Spices Board

Species Board Act, 1986

It was constituted in a statutory body on 26 February, 1987 and the Board has its head office at Kochi and is headed by a Chairman.

SPECIAL ECONOMIC ZONES

India established Asia’s first EPZ setup, Kandla, in 1965 followed by seven more zone thereafter but due to flaw in EPZ it failed then after removing shortcomings of this model and adding some new features Special Economic Zones (SEZs) policy is launched in April 2000 with the intention to boost economic growth with the help of quality infra and attractive fiscal package, both at centre and state level.

  • A designated duty free enclave to be treated as foreign territory only for trade operations and duties and tariffs.
  • No licence required for import.
  • Manufacturing or service activities allowed.
  • SEZ units to be positive net foreign exchange earner within three years.
  • Domestic sales subject to full customs duty and import policy in force.
  • Full freedom for subcontracting.
  • No routine examination by customs authorities of export / import cargo.

In order to impart stability to SEZ policy, Special Economic Zone Act, 2005 supported by SEZ rules has been enacted which came into effect on 10th Feb, 06. Under the Act, offers for promotion of investment, including foreign investment are: duty free import / domestic procurement of goods for development, operation and maintenance of SEZ units, 100% Income Tax exemption on export income for SEZ units under Section 10AA of the Income Tax Act for first 5 years, 50% for next 5 years thereafter and 50% of the ploughed back export profit for next 5 years, exemption from Central Sales Tax, exemption from Service Tax and single window clearance mechanism for establishment of units.

YEAR

VALUE (Rs. Crore)

GROWTH RATE

2004-2005

18,314

32%

2005-2006

22,840

24.70%

2006-2007

34,615

52%

2007-2008

66,638

92%

2008-2009

99,689

50%

All the 8 Export Processing Zones (EPZs) located at Kandla and Surat (Gujarat), Santa Cruz (Maharashtra), Cochin (Kerala), Chennai (Tamil Nadu), Visakhapatnam (Andhra Pradesh), Falta (West Bengal) and Noida (U.P.) have been converted into Special Economic Zones. A total of 91 SEZs are making exports. Out of this 43 are IT/ ITES, 13 Multi product and 35 other sector special SEZs.

Few SEZ units: Nokia Special Economic Zone (Telecom equipments SEZ), Mahindra City SEZ; (Apparels and fashion accessories; IT / hardware; auto ancillary), Flextronics SEZ; (Electronic Hardware SEZ), ETL Infrastructure IT SEZ, Tamil Nadu.

Apache SEZ (Adidas Group) (Footwear SEZ): Wipro Limited, (IT SEZ); Divvy’s Laboratories Limited, (Pharma SEZ); Andhra Pradesh Mundra Port and Special Economic Zone, (Multiproduct SEZ); Gujarat Wipro Limited, 2 SEZs in Sarjapur and Electronic City (IT SEZ); Biocon Limited, (Biotech SEZ); Manyata Promoters Private Limited, (IT / ITES SEZ); Karnataka, Serum Bio-Pharma Park, (Pharma SEZ); Maharashtra Airport Development Corporation Limited, (Multi product SEZ); Maharashtra, 4 Chandigarh Administration, (IT SEZ); Chandigarh, Hyderabad Gems Limited, Hyderabad (Gems and Jewellery SEZ);Reliance Jamnagar Infrastructure Ltd. (Multi Product); Suzlon Infrastructure Ltd., (Hi-tech Engineering Products & related services).

SEZs: IMPORTANT INVESTMENTS

BITE

COMPANY

CATEGORY

Navi Mumbai

NMSEZ Devt.

Company

Multiproduct

Jamnagar

Reliance Infrastructure

Petrochemicals

Jhajjar

Reliance Industries

Multiproduct

Gurgaon

DLF Universal

Multiproduct

Mundra

Mundra SEZ

Multiproduct

Dholera (Gujarat)

Adani SEZ

Multiproduct

Mysore

Jubliant Organosys

Biotechnology

Aurangabad

Bajaj Auto

Automobiles

Chennai

TCS

Infotech

Gurgaon

DLF Cyber City

Infotech

Hyderabad, Bangalore

Wipro

Infotech

Mohali

Ranbaxy

Pharmaceuticals

Greater Noida

Moser Bear

Energy

PTA with SACU: The Southern African Customs Union (SACU), the oldest in the world, comprises South Africa, Lesotho, Swaziland, Botswana and Namibia. India and SACU have expressed their intent to enter into a Preferential Trade Agreement (PTA) and have commenced negotiations for PTA in October, 2007 and three meetings of negotiating teams have taken place so far. India and SACU signed a Memorandum of Understanding, during the third round of negotiations held in New Delhi on 25-27 November, 2008.

CECPA with Mauritius: A Comprehensive Economic Cooperation and Partnership Agreement (CECPA) aimed at boosting bilateral trade, investment and general economic cooperation between India and Mauritius is being negotiated.

Focus Africa Programme: The Programme was launched with focus on only seven countries of Sub-Saharan Africa (SSA) Region, namely, South Africa, Nigeria, Mauritius, Tanzania, Kenya, Ghana and Ethiopia which later on extended to include Angola, Botswana, Ivory Coast, Madagascar, Mozambique, Senegal, Secychells, Uganda, Zambia, Namibia and Zimbabwe, along with the six countries of North Africa, viz., Egypt, Libya, Tunisia, Sudan, Morocco and Algeria. The Focus Africa Programme is continuing for the seventh year during 2008-09.

Trade and Investment relations with European Union: The European Union (EU) presently consists of 27 countries. These countries are Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, The Netherlands, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, UK, Bulgaria and Romania. India and EU have following agreement: (i) India-EU Cooperation Agreement on Partnership and Development Aug., 1994 (ii) India-EU Strategic Sept., -05. India also has bilateral economic Agreements with 26 EU countries individually in the areas of trade to avoid double taxation where as for investments and promotions / protections with 22 countries of Europe, including 17 countries of EU. India-EU bilateral relations are reviewed on the basis of reports given by three Sub-Commissions on Trade, Economic Cooperation and Development Cooperation and nine Joint working groups on issues related with agriculture and marine products, textiles, information technology and communications, consular matters, environment, steel, food processing industries, pharmaceuticals and bio-technology and technical barriers to trade (TBT) / sanitary and phyto sanitary (SPS) by India-EC Joint Commission, last meeting held on July, 08.

MMTC: MMTC Limited is India’s largest trading company with an annual business turnover close to US$ 8 billion. It is the largest exporter of Minerals and Ores from India, leading exporter / importer of Agro commodities, single largest importer / supplier of Bullion, a major player in the Coal and Hydrocarbons and Non-Ferrous Metals imports by the country and one of India’s largest buyers of Finished Fertilizers and Fertilizer Raw Materials.  MMTC has earlier set up Neelanchal Ispat Nigam Limited (NINL) an iron and steel plant of 1.1 million tonne capacity and a 0.8 million tonne coke oven plant with captive power plants, jointly with the Government of Odisha at a total capital outlay of nearly Rs. 2000 crore. Singapore in October, 1994 which holds “Global Trader” status award given by International Enterprise, Singapore in 2000. MMTC plans to set up in partnership with a leading Indian Company, a chain of retail stores at various cities in India for medallions, jewellery and its home grown brand of “SANCHI” silverware. MMTC has already promoted development of a temporary jetty at Ennore port for loading iron ore to decongest Chennai port. MMTC is also a member of a consortium which is constructing permanent iron ore loading berth at Ennore which is expected to be commissioned by early 2010. MMTC is also a partner in another consortium, which has been awarded the project for construction of a deep draft iron ore berth at Paradip port as well. Moreover, to facilitate promotion of two ways trade MMTC took lead in setting up free trade and warehousing zones at Greater Noica, Haldia and Kandla. MMTC has also already acquired railway rakes under the ‘Own Your Wagon Scheme’ of the Indian Railways, besides commissioning a crushing and screening plant in Bellary – Hospet sector to produce caliberated lumpy iron ore. MMTC has entered into clean power sector that is environment and eco-friendly by setting up and operating a 15 MW Wind Power Farm in Karnataka.      

STC: The State Trading Corporation of India Ltd., (STC) is premier international trading company engaged in exports, imports and domestic trade for over five decades. The corporation has played a key role in the Indian economy. It has acted as an arm of the GOI not only to regulate foreign trade but also for intervention in the domestic market.

INTELLECTUAL PROPERTY RIGHTS

PATENTS

An invention is a patentable if it is new, if it involves a non-obvious step and if it is industrially applicable. (Example: Safety valve mechanism of a pressure cooker). Patent shall be available for any inventions, whether products or process, in all fields of technology, provided they are new. They involve an inventive state and are capable of industrial application. The Patent expiry period is 20 years. The Patent needs to be proved new by three diagnosis and experimentation including research experimental aspect as well as commercial aspect. The Patent is not only applicable to product but also to plant varieties and also ‘sui generis’ product varieties.

INDUSTRIAL DESIGNS

Relate to the shape, configuration, pattern or ornament applied to an article by an industrial process of means whether manual, chemical or mechanical (shape of a handle or body portion of pressure cooker). India has Design’s Act of 1911. In this technological and functional aspects are included out of designs whereas the beautification and the outer design are part of industrial design. There are two bases of Industrial Design: 1. It should be new (novice); AND 2. It should be fundamental.

TRADE MARKS

Any sign, or any combination of signs capable of distinguishing the goods or services of one undertaking from those of other undertakings, shall be capable of constituting a trademark. Such Signs, in particular words including personal names, letters, numerals, figurative elements and combination of colours as well as any combination of such signs are eligible (“Prestige” pressure cooker). Even the services are included and for this service mark is used. Essentially, a trademark or a service mark enables a person to make a distinction between products and suppliers. No one can copy the TM of a company. In India the TM law is guided by Trade and Merchandise Marks Act 1958 (TMMA). In 1993, an amendment was sought in this field to protect the % trade mark, but it was not passed. Finally, in Dec., 1995 the parliament passed the amendment and now even provisions of protection of TM is there.

GEOGRAPHICAL INDICATIONS

“Indications which identify a goods as origination in the territory of a member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to the region” (Darjeeling tea).  In India there is no specific law on G.I. in 1999 a new law has been made which has following provisions: (i) Marketing and production of anything outside its originating place will be prohibited; (ii) Marketing of the same product in the same name will be prohibited.

TRADE SECRETS

“Secret information which is not generally known as accessible, information which has commercial value because it is secret and the person in control of the information has taken steps to keep it secret” (“Coca Cola” formula).

INTEGRATED CIRCUITS

With regard to the Treaty on Intellectual Property in Respect of Integrated Circuits members agreed to provide protection to the layout-designs (topographies) of integrated circuits.

COPYRIGHT AND RELATED RIGHTS

This is guided by Bern Convention. In India, a bill related to copyright was introduced in 1993 by amending Trade and Merchant Marks Act of 1958. Areas of its implications: (a) phonogram and information institutes actors and producers; (b) computer to be protected as a literary work and (c) Even dramatic work is included but it does not include a cinematograph.

Last Updated on Thursday, 24 May 2012 12:32