Responding to concerns raised by India on a surge in imports of silver, platinum and dates from the UAE in a possible flouting of free trade pact rules, the UAE has assured that it will respond timely to the verification requests sent by the Indian Customs department to help it confirm the authenticity of certificates of origin issued under the bilateral Comprehensive Economic Partnership Agreement (CEPA), sources have said.
“Timely verification of the certificates on adherence to rules of origin (ROO), which are important in establishing that value added norms fixed under the CEPA are being strictly followed by partner countries, will help India in ascertaining that the shipped items are indeed originating from the UAE and not another destination. It could help check import surges to some extent,” an official tracking the mater noted.
India-UAE meet
At the recent India-UAE joint commission meeting in Dubai, the UAE also agreed to expedite recognition of meat certification from India and address issues pertaining to fast tracking of pharmaceutical registration and viable reference pricing mechanism for Indian pharma products, the official added.
The India-UAE CEPA, implemented in May 2022, includes commitments by India to bring down import duties on a wide range of goods over a period of time. On silver, duties are to be reduced to zero over ten years.
In FY24, silver imports from the UAE increased 5853 per cent rise to $1.74 billion from only $29 million during FY23, raising concerns on imports coming in from third countries through the UAE by flouting the ROO norms.
Duty advantage
To address the duty advantage that UAE has, India brought down the MFN import duties (applicable on all countries) on gold and silver to 6 per cent from 15 per cent in this year’s budget. “Since the tariffs on silver imports from the UAE and many other goods will gradually be reduced to zero, the concerns on ROO compliance has to be urgently addressed,” the official said.
Commerce & Industry Minister Piyush Goyal also discussed this issue with his counterpart and colleague Thani Al Zeyoud from UAE who had assured that the concerns will be duly addressed.
“At the India-UAE joint committee meeting, UAE assured full cooperation in terms of making sure there is no circumvention. We will take up the matter again at the next joint committee meeting in India,” the official said.
Significantly, India’s imports from UAE in April-October 2024 increased 55.12 per cent to $38.64 billion against $24.91 billion in the same period previous last fiscal. India’s exports to the UAE, too, went up in the seven-month period, but at a lower rate of 15.86 per cent to $20.93 billion, compared to $18 billion in April-October 2023-24. Trade deficit during the period increased to $17.71 billion from $6.85 billion in the same period a year ago.