India excludes 1,157 products from ambit of free trade pact with UAE

Union Minister of Commerce and Industry Piyush Goyal signs the CEPA. The UAE delegation was led by Minister of Economy, Abdulla bin Touq Al Marri and Minister of State for Foreign Trade Thani bin Ahmed Al Zeyoudi. (PC-PIB)

India has kept out as many as 1,157 products, including TVs, picture tubes, soaps, toys, footwear, instant coffee, sharbat, and petroleum waxes, from the ambit of its free trade agreement with UAE.

The pact came into force on May 1.

Given the sensitivities of these products for the domestic industry, India will not provide any kind of customs duty concessions on the 1,157 goods under the the India-UAE Comprehensive Economic Partnership Agreement (CEPA), according to FAQs prepared by the commerce ministry on the pact.

The product categories include jewellery (except for 2.5 tons quota for gold jewellery), plastics, scrap of aluminium and copper, most automobiles and automotive components, medical devices, dairy products, fruits, cereals, sugar, food preparations, tobacco products, dyes and pigments, natural rubber, tyres, and processed marble.

TVs, picture tubes, soaps, toys, footwear, instant coffee, sharbat, and petroleum waxes are among the products that have been excluded from the ambit of the trade pact.

As per the FAQ, the CEPA is likely to benefit about USD 26 billion worth of Indian products that are subjected to 5 per cent import duty by UAE.

The agreement has also stringent product-specific rules of origin that reflect the requirement for substantial processing.

The certificate of origin, a key document required to avail the duty benefits under the pact, will be issued by the Ministry of Economy of the UAE to prevent circumvention of the rules of origin criteria.

The agreement has built-in protection to ensure that no third country product enters Indian market through UAE and benefit from concessional tariffs without being substantially transformed., it added.

"The India-UAE CEPA trade in goods does not allow such products through a stringent rules of origin that reflect the requirement for substantial processing,” it added.

Further, it said a concept of review of the agreement has been put in place to take stock of the operation of the pact and based on the same, suggest the future course of action.

The agreement is operationalised and implemented through a joint committee.

The committee would meet biennially to review the agreement with a purpose of considering additional measures to further enhance the pact.

To promote trade in services, both the countries have undertaken commitments in 11 broad categories, including business, communication, construction, educational and financial.

Market access has been offered for business visitors, intra corporate transferees, and contractual services suppliers in a range of services sectors.

On government procurement chapter of the pact, the ministry said that it has certain binding commitments related to process, procedure and transparency elements of government procurement for only a limited number of central government ministries and departments.