India’s National Trade Facilitation Action Plan (NTFAP), which aims to reduce cargo release time for exports and imports as part of measures intended to boost trade, has been described by the World Customs Organisation (WCO) as a ‘best practice’ that other nations can adopt.
The WCO on Friday emphasised the fact that as many as 51 of the 76 activities mentioned in the NTFAP (released by the Centre on Thursday) “go beyond” the implementation requirements of the World Trade Organisation’s Trade Facilitation Agreement (TFA).
The NTFAP, which is to be implemented between 2017 and 2020, is part of India’s efforts to improve its ease of doing business ranking in the World Bank’s annual report. While India’s overall rank in the report is 130, it ranks 144 out of 190 nations in the report’s ‘Trading Across Borders’ category.
The TFA — meant to ease Customs norms for faster flow of goods across borders — had come into effect in February 2017.
Ratified in 2016
India had ratified the TFA in April 2016. As per the WTO, “the full implementation of the TFA could ... boost global trade by up to $1 trillion per year.”
The requirement to implement the TFA is directly linked to the capacity of the country to do so, the WTO had said.
“It is a good document. It has several activities that go beyond the TFA to help improve India’s competitiveness. It will be an inspiration to many countries,” WCO Secretary General Kunio Mikuriya said at a function organised by industry body FICCI, World Bank and the Finance Ministry. “We will adopt it as a best practice and recommend it to all the other countries.”
The WCO — the international body supporting the uniform implementation of the TFA across the globe — has 182 member nations (including India) that manage more than 98% of world trade.
Justifying the large number of TFA-plus activities, the NTFAP stated that “Since infrastructure and technology augmentation are prime enablers for trade facilitation, more so for India, the action plan (NTFAP) covers many activities in these areas.”
It added, “Since they go beyond the ambit of the TFA per se, they have been defined as TFA Plus category....”
Global benchmarks
The NTFAP further stated that “similarly, enhancement of existing compliance levels to achieve global benchmarks in crucial segments like Time Release Study, Post Clearance Audit and AEO (Authorised Economic Operator) scheme belong to the TFA Plus category as they are dynamic objectives.”
Of the 51 “TFA-plus activities”, most (or 34) have a timeline of six to 18 months. These include alignment of India’s foreign trade policy with the Goods and Services Tax (GST) regime and the WTO’s TFA, as well as gate automation at ports, establishment of labs at sea/air ports, and complete automation of ‘transit movement and transhipment procedures’.
Six-month deadline
While 12 of the “TFA-plus activities” have a deadline of up to six months (including giving information on average clearance time at gate, fixing responsibility for delays in giving clearances), five such activities have a timeline of 18-36 months (including improving infrastructure).
Of the 25 activities that are part of the TFA requirements, 17 will be implemented within 6-18 months, while eight have a timeline of up to six months.
