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New Delhi: India and the UAE will hold their first joint trade committee meeting next week to review the free trade pact signed last year, a government official said. Both countries are expected to announce utilization rates for the free trade agreement, which will provide a clear indication of the benefits of the deal.
New Delhi: India and the UAE will hold their first joint trade committee meeting next week to review the free trade pact signed last year, a government official said. Both countries are expected to announce utilization rates for the free trade agreement, which will provide a clear indication of the benefits of the deal.
While the Commerce and Industry Ministry said Indian exporters received significant tariff concessions under the Comprehensive Economic Partnership Agreement (CEPA), it has yet to reveal key free trade agreement utilization rates due to lack of data. Historically, India’s FTA utilization has remained below 25%, the lowest in Asia, according to the Asian Development Bank.
While the Commerce and Industry Ministry said Indian exporters received significant tariff concessions under the Comprehensive Economic Partnership Agreement (CEPA), it has yet to reveal key free trade agreement utilization rates due to lack of data. Historically, India’s FTA utilization has remained below 25%, the lowest in Asia, according to the Asian Development Bank.
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The agreement, which came into force on May 1, 2022, removed Indian duties on 90% of the UAE’s exports by value, covering sectors including gems and jewellery, textiles, leather and engineered products. Precious stones and jewellery, electrical machinery, motor vehicles, grain, and machinery and mechanical appliances saw the largest gains in value.
The Ministry of Commerce and Industry expects India’s exports to the UAE to rise to a record $50 billion by 2026-27 from $31.8 billion in 2022-33.
COOs issued to India surged to 8,440 in March from 6,944 in February, official data showed. A COO issued to an Indian exporter certifies that the goods meet certain criteria to be considered as originating in India. COO of mandatory tariff concessions under free trade agreements (FTAs) can be reflected in actual exports with a lag and is a strong indicator of convention utilization.
According to a Deloitte report, the low utilization rate of FTAs ​​in India can be attributed to a variety of factors, including low industry awareness of FTAs ​​and rules of origin (RoO), and low participation by the industry in the benefits of trade agreements. negotiation.
India’s exports to the UAE rose 11.8% to $31.8 billion in 2022-23, compared to $28 billion a year earlier. The largest export product was oil, which rose 36% year-on-year to $7,780.22 million in the April 22-March 23 period.
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