In April 2016, India had formally ratified the WTO’s Trade Facilitation Agreement, which aims at easing customs procedures to boost commerce. TFA was outcome of 9th Bali Ministerial package and included provisions for lowering import tariffs and agricultural subsidies; abolish hard import quotas; reduction in red tape at international boarders etc.
This ratification is expected to supplement India’s ongoing reforms to bring in simplification and enhanced transparency in cross border trade in goods. It would further step India to boost economic growth by reducing trade costs and supporting its integration into global economy.
As a consequent to this ratification, India needed to mandatorily set up the National Committee on Trade Facilitation
National Committee on Trade Facilitation is the local institutional mechanism for India to facilitate domestic co-ordination and implementation of TFA provisions.
It will enable to play the leading role in developing a pan-India road map for trade facilitation.
Further, it will play an instrumental role in synergizing the various trade facilitation perspectives across the country and will also focus on an outreach programme for sensitization of all stakeholders about TFA.
NCTF is an inter-ministerial body on trade facilitation, chaired by the Cabinet Secretary. It is a three tier structure committee with the main national committee playing a pivotal role in monitoring the implementation of the TFA. Below it, there will be a steering committee.
A NCTF would act as a permanent body established with the objective of simplifying and automating procedures and information exchange in administration, commerce and transport. It will facilitate both domestic coordination and implementation of provisions of the TFA. It will play a vital role in communication channel between government and the private sector as well as help avoid turf wars among the numerous government agencies involved in cross-border trade. The tasks of the NCTF would include drawing up and implementing a national trade facilitation plan, assessing barriers to trade facilitation and making policy recommendations for their reform, providing a national focal point for the collection and dissemination of information, reviewing and evaluating progress of negotiations and making timely recommendations for adjustments.
Already the developed countries, such as UK and Sweden, have successfully operated TF committees. Also many developing countries are increasingly using this committee method for streamlining their trade and transport operations. In South Asia itself, Nepal had established a NTFC in 1997 and Pakistan in 2001. China also established one in 2004.
UNCTAD has stated that such committees are not only instrumental in maintaining coordination and communication but also help in implementation of concrete projects and ensuring a good WTO negotiating position. The committee could play both a regulatory as well as advisory functions and also be empowered to implement facilitation measures.
Experts state that such a committee would enable India secure a fair share in the $1 trillion annual generation of world economy.