TFA Current Affairs

Government releases National Trade Facilitation Action Plan

The Union Government released the 76 point National Trade Facilitation Action Plan (NTFAP). It was released by Union Finance Minister Arun Jaitley in New Delhi.

The NTFAP has been adopted by the National Committee on Trade Facilitation (NCTF), reflecting Government’s commitment to implement the Trade Facilitation Agreement (TFA).

Key Facts

Aims of the action plan: Transform cross border clearance ecosystem through efficient, transparent, risk based, co-ordinated, digital, seamless and technology driven procedures supported by state-of-the-art sea ports, airports and land borders.

Objectives of the action plan: Achieve improvement in ease of doing business by reduction in cargo release time and cost, transparent and predictable legal regime, move towards paperless regulatory environment and improved investment climate through better infrastructure.

Activities listed in the Action Plan: It lists out specific activities which would be carried out by all regulatory agencies like Customs, Drug Controller, Plant Quarantine, FSSAI, DGFT etc. in time bound manner. The co-ordination among all the stakeholders is the key to achieve the objective of Trade facilitation.

It not only covers the activities coming under the TFA but also goes beyond the ambit of TFA, defined as TFA Plus category. It covers many activities in the areas of infrastructure augmentation, particularly the road and rail infrastructures leading to ports, airports, Land Customs stations, ICDs that cuts across all stakeholders for which various ministries like Civil Aviation, Shipping, Railways, Home Affairs, Road transport and Highways, Finance, Commerce etc have been assigned specified targets. All actions falling under the plan have been categorised by prioritising the activities into short term, mid-term and long-term activities.

Monitoring of the plan: The plan will be monitored by the Steering Committee (the operational arm of the NCTF) chaired by the Revenue Secretary and the Commerce Secretary. Further it will be reviewed by the Cabinet Secretary.

Background

Earlier in August 2016, the Union Government had constituted NCTF headed by the Cabinet Secretary in accordance with Article 23.2 of the WTO-TFA. It comprises stakeholders from the Government and the private sectors including trade community. It is headed by Cabinet Secretary.

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WTO’s Trade Facilitation Agreement comes into effect

The Trade Facilitation Agreement (TFA) in Goods of World Trade Organisation (WTO) came into effect with its ratification by two-thirds members of WTO including India.

The TFA in Goods was adopted by the WTO Members in 2014. It aims to streamline, simplify, standardise and ease customs procedures and norms. It will help to cut trade costs around the world.

About Trade Facilitation Agreement (TFA)

  • The TFA in Goods is the WTO’s first-ever multilateral accord that aims to simplify customs regulations for the cross-border movement of goods.
  • It was outcome of WTO’s 9th Bali (Indonesia) ministerial package of 2013. The agreement includes provisions for
  • Lowering import tariffs and agricultural subsidies: It will make it easier for developing countries to trade with the developed world in global markets.
  • Abolish hard import quotas: Developed countries would abolish hard import quotas on agricultural products from the developing world and instead would only be allowed to charge tariffs on amount of agricultural imports exceeding specific limits.
  • Reduction in red tape at international borders: It aims to reduce red-tapism to facilitate trade by reforming customs bureaucracies and formalities.
Comment

The implementation of the TFA in Goods has the potential to create US 1 trillion dollars’ worth of global economic activity and trade which may add 21 million new jobs and lower the cost of doing international trade by 10 to 15 per cent. TFA will help India’s ongoing reforms to bring in simplification and enhanced transparency in cross border trade in goods. It will further help India to boost economic growth by reducing trade costs and supporting its integration into the global economy.

Trade Facilitation in Services (TFS) Agreement

  • Recently, India submitted a legally vetted proposal on Trade Facilitation in Services (TFS) Agreement, a global services pact on the lines of the TFA in Goods to the WTO.
  • Now the proposal for TFS Agreement will be taken up by an expert committee at the WTO headquarters in Geneva and later it will be put up for discussion among all the WTO members.
  • It aims to ease norms for movement of skilled workers across borders for short-term work, ensure portability of social security contributions, single window mechanism for foreign investment approvals and cross-border insurance coverage to boost medical tourism.

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