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Entry for 4,500 LDC items to be tax-free
November, 23rd 2007
India will allow tax-free import of over 4,500 items from neighbouring Bangladesh, Nepal, Maldives and Bhutan from January 2008, a year before it was scheduled to eliminate taxes for least-developed countries under the South Asia Free Trade Agreement (Safta). Prime Minister Manmohan Singh has also directed the commerce department to examine if the negative list of 744 items (products on which tariffs will not be reduced) could be shortened for LDCs.

Afghanistan, too, would be able to benefit from the arrangement as all protocol for formally inducting Afghanistan into FTA would be over by March 2008, minister of state for commerce Jairam Ramesh said.

Once Afghanistan becomes a member of Safta, it will automatically benefit as the agreement allows a 30% domestic value addition for exported products while Indias bilateral arrangement with Afghanistan provides for 50%, Mr Ramesh said.

Addressing a press conference, the minister said that Indias trade with Afghanistan could multiply provided Pakistan could be roped in. Pakistan, India and Afghanistan could form a triangle for regional development of trade, he said.

A trade delegation of 50 Afghan businessmen is currently visiting India. In a seminar organised by Ficci on Wednesday, the delegation expressed interest in collaborating in the area of gems & jewellery and handicrafts & carpets.

India and Afghanistan also have a preferential trade agreement in place under which 38 Afghan products receive preferential treatment in India against eight Indian items.
 
 
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