42.5% of Bilateral Trading Goods Between China and India Exempted from Customs Duties

On September 13, "The Hindu" quoted government sources as saying that India and China has agreed, under the Regional Comprehensive Economic Partnership (RCEP) Agreement framework, tariffs of half the goods in bilateral trade between India and China would be exempted. The government source said that the two countries have agreed on 42.5% of the bilateral trade of goods exempted from customs duties, "No industry hopes Chinese goods into India with zero tariff, so we’re nervous, but it must take such a pragmatic step, because we will also be able to have zero-tariff access to the Chinese market. "

The above-mentioned report also said, concerning the specific arrangements for bilateral tariff exemption measures, it would be completed in the tenth round of negotiation of RECP in October this year in Busan, Korea.

Regional Comprehensive Economic Partnership Agreement negotiations lasted nearly three years, and made key progress in the Third Ministerial Conference held in Kuala Lumpur in August this year.

At the meeting, the participants agreed on the bid patterns of trade in goods, and agreed to strive to complete the substantive negotiations before the end of 2015 and to resolve other technical issues in the year 2016 as soon as possible.

"The Hindu" argument is that India's Commerce and Industry Ministry has launched consultations with India Industries on which field tariff can open, which needs to be protected, the implementation period of tariff exemptions will be 10 years.

The director of Institute of World Economy of Academy of International Trade and Economic Cooperation Liang Yanfen in an interview with Post reporters pointed out that the economic impact of some of the goods exempted from customs duties depends on the specific product category, "it is unlikely to suddenly exempt sensitive product tariff, some categories that has little effect on both may be chosen."

Some analysts believed that the tariff reduction would help the goods to enter each other's market. That would have a lot of influence on India. In early May this year, the Federation of Industry and Commerce in India said, China and India signed a free trade agreement, in the short term, it would benefit China, India will be at a disadvantage, because of the high tariff in India. (www.chinainout.com)