India will have the option of temporarily withdrawing customs duty concessions on EFTA country goods under the trade agreement between the two sides, if the four European nation bloc would not fulfil its USD 100 billion investment obligations. Though the investments have to flow in 15 years -- USD 50 billion in the first 10 years (counted after implementation of the pact) and another USD 5 billion in next five years, the trade deal also provides for a three-year grace period to the EFTA bloc to meet the obligations, according to the documents accompanying the agreement.

 

India and four-nation European Free Trade Association (EFTA) bloc signed Trade and Economic Partnership Agreement (TEPA) on March 10 under which New Delhi received a foreign direct investment commitment of USD 100 billion in 15 years from the member countries of the grouping.

 

The EFTA members are Iceland, Liechtenstein, Norway, and Switzerland.

 

There is a three-stage government-to-government consultation process prescribed in the document for resolution of differences raised in relation to the obligations.

 

'If, after the consultation period, India is still of the opinion that the EFTA states have not fulfilled their obligations, India may, after a further grace period of three years, suspend concessions. The suspension of concessions needs to be proportionate and temporary,' according to the agreement documents posted on EFTA website.

 

It would take around a year for the agreement to come into force.

 

The investment promotion and cooperation chapter of the agreement talks about a regular review by a specially appointed sub-committee, and it provides for a three-stage consultation procedure which can be invoked by India if the defined target has not been reached after 15 years.

 

An investment sub-committee would review progress towards the achievement of the shared objectives. The first review by the committee will be held no later than 5 years after entry into force of this agreement. Similarly, the second review would take place after 10 years.

 

The final review shall take place 15 years after entry into force of this agreement.

 

The document, however, stated that in case of occurrence of any unforeseen circumstances like global pandemic, war, geopolitical disruptions, financial crisis or sustained economic underperformance, which have had a material bearing on the progress to achieve the shared objectives, the two sides will adjust the shared objectives accordingly.

 

To facilitate investments India will have to ensure a favourable investment climate while taking into account the need to identify, assess and mitigate potential risks for security or public order.

 

As per the documents, all the duty cuts would be carried out over a period of 10 years with different timelines for each category of goods by India for EFTA member countries.

 

The joint committee will be the apex body to supervise and administer the TEPA and to oversee its further development.

 

India has received about USD 10 billion in foreign direct investments (FDI) from Switzerland between April 2000 and December 2023. It is the 12th largest investor in India.

 

The FDI inflow was USD 721.52 million from Norway, USD 29.26 million from Iceland and USD 105.22 million from Liechtenstein during the period.

Prime Minister Narendra Modi spoke to his British counterpart Rishi Sunak on Tuesday when they welcomed the 'thriving' bilateral partnership and progress made in the ongoing negotiations towards securing a 'historic and comprehensive' India-UK Free Trade Agreement that benefits both countries.

 

During the telephonic conversation, both leaders reaffirmed their commitment towards strengthening the bilateral comprehensive strategic partnership, a statement in New Delhi said.

 

A Downing Street readout of the call noted that Sunak and Modi agreed on the importance of securing a 'historic and comprehensive deal' that benefits both countries and reiterated the importance of an 'ambitious' outcome for bilateral trade, which is currently worth around GBP 36 billion a year.

 

In a post on X, Modi said, 'Had a good conversation with PM @RishiSunak. We reaffirmed our commitment to further strengthen the bilateral Comprehensive Strategic Partnership and work for early conclusion of a mutually beneficial Free Trade Agreement.'

 

According to Sunak's office, the leaders agreed to remain in close contact as they anticipated further progress in the FTA talks, now in their 14th round of negotiations.

 

'The leaders welcomed the thriving partnership between the UK and India and discussed recent progress on Free Trade Agreement negotiations,' a Downing Street spokesperson said.

 

'They agreed on the importance of securing a historic and comprehensive deal that benefits both countries. The Prime Minister reiterated the importance of reaching an ambitious outcome on goods and services. They agreed to remain in close contact and looked forward to further progress on trade talks,' the spokesperson said.

 

The statement from New Delhi also noted that the two leaders expressed satisfaction over the progress made under the 'Roadmap 2030' in diverse areas including trade, investment, defence, security, emerging technologies and others.

 

'They assessed positively the progress made towards early conclusion of a mutually beneficial Free Trade Agreement,' it said.

 

The two leaders also exchanged views on regional and global developments of mutual interest and agreed to remain in touch and exchanged greetings on the upcoming festive occasion of Holi, the statement added.

 

Kalanamak, a premium non-basmati rice variety grown in Uttar Pradesh, may be the first one to get an exemption from export ban. However, the move may lead to a slew of demand from across the country where premium rice varieties are grown. An inter-ministerial panel is reported to have approved the proposal of the Food Ministry on Monday and a notification is likely to be issued by March 15, sources said.

 

It is learnt that the government has decided to allow the shipments of Kalanamak rice through a port in Tamil Nadu after it is certified by the Uttar Pradesh government. However, there will be no distinction to be made between evolved varieties (dwarf plants) and traditional varieties (greater height of plant), sources said.

 

The issue was taken up by the Union Food Ministry after the Uttar Pradesh government sought an exemption amid the discontent among farmers of not getting good prices, the sources said. Uttar Pradesh government has assessed that 50 tonnes of the variety may be exported over the next few months if a decision is taken now to exempt Kalanamak, the sources said. In 2021-22, as much as 21 tonnes got exported, trade sources said.

 

Lord Buddha’s gift

Kalanamak, with a black husk and a strong fragrance, is considered a gift from Lord Buddha to the people of the Sravasti when he visited the region after enlightenment. The variety also has a Geographical Indication (GI) tag when grown in 11 districts of UP – Bahraich, Balrampur, Basti, Deoria, Gonda, Gorakhpur, Kushinagar, Maharajganj, Santkabirnagar, Shravasti and Siddharthnagar.

 

The government has released Pusa Narendra Kalanamak 1638 and Pusa Narendra Kalanamak 1652 varieties developed by Indian Agriculture Research Institute (IARI) in 2022.

 

Exports of both basmati and non-basmati have dropped by 27 per cent to 13.23 million tonnes (mt) during April-January of current fiscal from year-ago due to these curbs. The drop in non-basmati rice exports is even more steep, down by 37 per cent to 9.13 mt.

 

In order to ensure food security and keep prices under control, the Centre has taken various measures since September 2022. It first banned exports of broken rice and then imposed a 20 per cent duty on white rice. Last year, it banned exports of white rice and levied a 20 per cent export duty on parboiled rice and has fixed $950 a tonne as minimum export price for basmati shipments.

 

'When the export of non-basmati rice was banned in the year 2008, the government later exempted Sona Masoori, Ponni, Samba and Matta varieties from the curbs through an export quota. India’s rice policy was always formulated on the lines of basmati and non-basmati rice. As a result, most of the specialty rice varieties get diluted within the category of non-basmati rice,' said foreign trade policy expert S Chandrasekaran.

 

Cornerstone decision

If recognition to Kalanamak rice is made, it will be a cornerstone policy decision that will show that the government upholds other specialty varieties equivalent to basmati rice, he said.

 

In January 2024, the government came up with rules for Gobindabhog and Tulaipanji, which is a major policy shift to promote regional specialty rice varieties, Chandrasekaran said and added that the need of the hour is to abandon the usage of the term non-basmati rice and start using labels like specialty, aromatic, premium and common.

 

The agriculture Ministry has already notified grading and marketing rules for five premium non-basmati rice varieties of West Bengal – Gobindabhog, Tulaipanji, Kataribhog, Kalonunia and Radhunipagal.

Global wheat production in 2024 is forecast to increase by 1% over the previous year but will fall short of the record output reached in 2022, according to a report from the Food and Agriculture Organization (FAO) of the United Nations.

 

The FAO noted that in the United States and Canada, two of the world’s largest wheat producers, plantings are down but anticipated yields are up due to improved weather conditions. The FAO pegs 2024 US wheat production at 51.5 million tonnes, which would be above the recent five-year average and last year’s total. Canada, meanwhile, is projected to harvest 33 million tonnes in 2024 despite a 2% contraction in wheat plantings.

 

Also contributing to the FAO’s projected global wheat output of 797 million tonnes are Russia, where a small increase is expected due to favorable weather conditions; China, where strong domestic demand and an increase in the minimum purchase price have supported expanded planted area is spurring an expected rise in production; and Pakistan, which is expected to increase production to 28.3 million tonnes in 2024.

 

India had been expected to produce a near record crop this year, but recent rainfall and hailstorms in key production areas just before harvest have tempered expectations for the country’s wheat harvest despite increased plantings.

 

With wheat planting having been disrupted by heavy rains in several of the European Union’s key wheat-producing countries, particularly France and Germany, output in the EU in 2024 is expected to fall slightly to 133 million tonnes, the FAO said, adding that a similar scenario is expected to play out in the United Kingdom.

The Centre on Friday announced that outbound shipments from Special Economic Zones (SEZs) and Export Oriented Units (EOUs), which account for about a quarter of India’s exports, will now be eligible for tax refunds under the Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme.

 

Exporting firms who use the Advance Authorisation (AA) scheme, that permits duty-free import of inputs that are physically incorporated in the export product, will also be covered by the RoDTEP scheme, Commerce and Industry Minister Piyush Goyal said.

 

While the benefits will kick in from March 11 for EoUs and AA holders, SEZs will have to wait till their IT systems are integrated with the automated ICEGATE system of the Customs section. Keeping budgetary allocations in mind, the RoDTEP benefits for these producers will be valid till September 30 for now, the Commerce Ministry said, adding that key sectors like Engineering, Textiles, Chemicals, Pharmaceuticals and Food Processing will gain. 

 

'This decision comes in recognition of the significant contribution these sectors make to India’s Exports, constituting approximately 25% of our exports. Amidst global economic uncertainties and supply chain disruptions, extending RoDTEP to the uncovered sectors such as AA, EOU, and SEZ units will help the exporting community in handling the international headwinds,' Mr. Goyal said.

 

The RoDTEP scheme, launched in January 2021 to replace an earlier export incentive scheme that was seen as non-compliant with World Trade Organisation (WTO) norms, has a Budget of Rs.15,070 crore in 2024-25, and has so far provided support worth Rs.42,000 crore.

The Rajasthan government will soon announce the One District One Product (ODOP) policy, according to sources. A draft has been prepared and views and suggestions are being sought from stakeholders to make the policy more investor-friendly,  a state industries department official said.

 

'Every district offers something new — Jaipur has blue pottery, gems & jewellery, lac bangles, carpets, textiles among others; Jodhpur is rich in handicrafts and woodwork and some areas are rich in agricultural products. The ODOP endeavours to protect and promote this heritage by fostering traditional crafts and practices,'  the official said.

 

The ODOP aims to accelerate economic development within each district by harnessing the potential of local specialities. The policy looks to streamline investments, enhance production capabilities, and increase competitiveness.

 

According to the draft policy, the primary beneficiaries of the ODOP will be local artisans, farmers, manufacturers, and entrepreneurs engaged in producing and selling district products. Additionally, the policy will extend to associated stakeholders, including workers, traders, and exporters.

 

Product selection will be data-driven and criteria-based, focusing on uniqueness, scalability, historical significance, and current market presence. Factors such as the geographical indication (GI) status, export potential, and employment generation will also play an important role.

 

According to the official, incentives and exemptions given under the Rajasthan Investment Promotion Scheme (RIPS 2022) will also be applicable under the ODOP.

 

Further, to boost investment in ODOP MSMEs, the state also plans to provide a 15 per cent additional investment subsidy to such enterprises.

 

According to the draft policy, 'marketing help would be provided at achieving fair pricing for the artisans, weavers, entrepreneurs and exporters of the ODOP products. Under the marketing scheme, financial assistance would be provided to participants of national and international fairs, and exhibitions for display and sale of their products. Financial assistance for the same could vary from Rs 50,000 to Rs 2,00,000 for attending national and international fairs and exhibitions.

Commerce and Industry Minister Piyush Goyal on Friday said that the Modi government always keeps in mind commensurate and long-term benefits for the domestic industry while negotiating free trade agreements.

He stressed that 'gone' are the days when India used to accept the terms of the world.

 

'We crystal gaze into the future to make sure that its (FTAs) impact in the future will also be positive and we also look at balanced, fair and equitable FTAs,' he told PTI in an interview.

 

'So we can see the big Indian opportunity that we are offering and we want to make sure that we get commensurate benefits (from these pacts) for the country,' he said.

He indicated 'some good news' on this front in the days to come.

The remarks assume significance as India and the European Free Trade Association (EFTA) bloc concluded the talks for an FTA.

EFTA members are Iceland, Liechtenstein, Norway, and Switzerland.

The minister said that the free trade pacts of the Modi government involve a huge amount of stakeholder consultations with industry.

Besides, every line ministry also gets involved in making sure that the government protects the country's long-term interests, he said.

'Today we give out the terms, based on the big Indian opportunity that we bring to the table. I am very confident that we hear some good news in the days to come. Our officers are relentlessly pursuing several engagements. Let us see who pips the others,' he said.

Under free trade pacts, two trading partners significantly reduce or eliminate customs duties on the maximum number of goods traded between them, besides easing norms to promote trade in services and investments.

FTA talks for the UK and Oman are also at an advanced stage.

In a move aimed at further digitalising the process of agri-marketing in the country, the Indian Government is setting up an e-commerce portal to help farmers and agri-entrepreneurs connect with consumers and sell their products directly. The portal, Kisankart.online, is being developed by the Indian Council of Agricultural Research (ICAR)’s Agricultural Technology Application Research Institute (ATARI) in Bengaluru. It is expected to be fully operational around August this year.

 

Agri and value-added products produced by farmers, entrepreneurs mentored by the Krishi Vigyan Kendras (KVKs) and collectives such as the farmer producer organisations (FPOs) and self-help groups (SHGs) across the country will be made available to retail consumers through the Kisankart portal.

 

Bypassing middlemen

'The e-commerce platform will help enable farmers and agri-preneurs to expand their market reach, bypass the middlemen and reach the consumers directly. Bypassing the middlemen will help enhance farmers’ income,' said V Venkatasubramanian, Director, ATARI Zone 11, Bengaluru.

 

Besides eliminating the intermediaries, the creation of a digital agri-marketing system will help encourage local value addition at the farm level thereby reducing post-harvest losses, promote local and special products of various geographies while empowering the small and marginal farmers, Venkatasubramanian said.

 

The portal, developed by the technology team of ATARI has been launched on a pilot basis and integrated with KVKs such as Pathanamthitta, Gadag and Kolar, showcasing products of local agri- preneurs. Each KVK will have a separate marketplace on the portal showcasing the products and have a payment gateway.

 

A wide range of products produced by farmers and agri-preneurs such as vegetables, oils, spices, cereals, millets, orchids and value-added food products including those made from various fruits, vegetables and mushrooms among others will be made accessible to consumers through the e-commerce platform. Also, farmers can access inputs such as seeds, bio-formulations, micronutrient formulations, simple hand tool implements through the portal, Venkatasubramanian said.

 

Uniform brand

All products sold through the e-commerce platform will be under the uniform brand of Kisan Samriddhi, Venkatasubramanian said. Consumers will also have access to products coming out from various farmer centric schemes such as ODOP (One District One Product) and also the Geographical Indication (GI) tagged products through the portal.

 

There are some 731 KVKs spread across the country. Besides playing a key role in taking the technological interventions to the farmers to boost crop productivity, the KVKs are also engaged in encouraging local value addition through skill building among farmers and promoting agri-entrepreneurship to make farming sustainable and ensuring livelihood security of farm families. Products coming out of the KVKs are largely marketed through local sales counters at the premises.

 

The proposed e-commerce portal, which will open up a national market for such products, will be the government’s major market linkage initiative for the farmers after the rollout of e-NAM (electronic national agricultural market).

 

Himanshu Pathak, Secretary, DARE and DG ICAR, is optimistic in making the portal operational pan India benefitting millions of farmers and agri entrepreneurs. This will be a game changer in the process of digitalising the agri marketing.

 

Venkatasubramanian said ATARI will be leveraging the expertise of Centre for Development of Advance Computing (C-DAC) and the ICAR-IASRI (Indian Agricultural Statistics Research Institute) to upscale and roll out out the e-marketplace. It will also be partnering with entities such as Delhivery and India Post for the logistics and delivery of these products sold online.

India on Sunday signed a trade and economic partnership agreement with the European Free Trade Association (EFTA) - a grouping of Switzerland, Norway, Liechtenstein and Iceland - that includes a binding $100-billion investment commitment.

 

As part of the Trade and Economic Partnership Agreement (TEPA), EFTA has committed to promote investments to increase the stock of foreign direct investments (FDI) in India by $100 billion in the next 15 years, and to facilitate the generation of one million direct employment in India through such investments, the government said in a statement.

 

'The global leadership of EFTA countries in innovation and R&D across diverse spheres...will open up new doors of collaboration,' PM Narendra Modi said about the trade agreement.

 

Commerce and industry minister Piyush Goyal said India is signing an FTA with four developed nations for the first time. It is a 'modern and ambitious' trade agreement with an important economic bloc in Europe, he said.

 

FDI of $50 billion is expected to flow in the first 10 years, with another $50 billion expected to come in the following five years. 'The investment flow may be larger than we have estimated. We will mutually work out if there is any shortfall in investment,' Goyal said, noting that investment from EFTA has grown at a compounded annual growth rate of 13% in the last decade.

 

Officials said the agreement gives India the right to rebalance or suspend concessions if the investment value is not realised. They also stated that the deal provides legal certainty in terms of tariff regime and investment relations.

 

The investments are hinged on the nominal GDP growth of 9%, officials said. Goyal said India has included several elements such as environment, trade, IPR, and gender for the first time in TEPA. 'The free trade agreement balances asymmetries within economies of the EFTA region and Indian economy,' the minister said.

 

TEPA is the fourth major deal signed by India to promote trade and economic cooperation in the last three years. The others are with Australia, Mauritius and the UAE.

 

The deal has got a thumbs-up from the industry. 'Improved market access for goods will boost India's export potential to EFTA markets and greatly expand employment opportunities, especially with the historic $100 billion committed investment from the EFTA region,' said Chandrajit Banerjee, director general of the Confederation of Indian Industry (CII).

 

Cheaper watches, chocolates, machinery

 

The agreement will increase Indian industry's access to the EU market where the country is looking to sign another FTA. EFTA is offering 92.2% of its tariff lines, which cover 99.6% of India's exports, the commerce and industry ministry said. The agreement also covers tariff concession on processed agricultural products (PAP) from India. India is offering 82.7% of its tariff lines, which covers 95.3% of EFTA exports, nearly 80% of which is in gold.

 

Swiss watches and chocolates will enjoy the elimination of duty after seven years. The concessions are also expected to help India import machinery at cheaper rates.

 

Boost for gaming, animation

 

India has provided concessions on 105 of 156 sub-sectors, including areas like accounting, business, and health within services. On the other hand, EFTA countries have provided concessions in over 110 sub-sectors including accounting, auditing, and legal.

 

'Services will be one of the key pillars, just like investment and trade,' Goyal said. EFTA is providing commitments in audio-visual services like gaming and animation, and service providers from India will not be differentiated. India exports services worth over $5 billion to EFTA regions.

 

In the case of visa, India has secured a commitment in three categories: intra-corporate transferee, contractual service supplier, and independent professional.

Switzerland on Sunday said it will get duty-free access to the Indian market for selected agricultural products after a transition period of up to ten years under the trade agreement signed between India and EFTA.

India on Sunday signed the Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association (EFTA) under which New Delhi received an investment commitment of USD 100 billion from these four European countries.

 

EFTA members are Switzerland, Norway, Iceland and Liechtenstein.

'India is now the most populous country in the world. The growing middle class in particular is contributing to major growth potential. However, India currently levies very high import tariffs on most products,' Switzerland said in a statement.

Under the FTA, India will lift or partially remove customs tariffs on 95.3 per cent of industrial imports from Switzerland (excluding gold) either immediately or with transition periods, it added.

Swiss Federal Councillor Guy Parmelin and his counterparts from Iceland, Liechtenstein and Norway signed the agreement with Trade Minister Piyush Goyal here.

 

'Switzerland will also have tariff-free access to the Indian market for selected agricultural products after a transition period of up to ten years. This will strengthen the competitiveness of Swiss exports to India,' it added.

Switzerland's concessions to India for agricultural products are based on previous free trade agreements and are in line with Swiss agricultural policy.

In addition, the statement said, improvements have been made to intellectual property rights, in particular with regard to legal certainty, patent procedures and the protection of 'Swissness'.

'This will not restrict access to medicines in India. The FTA not only opens up broad market access for Swiss business players but also improves the legal framework, legal certainty and predictability,' it added.

It also said that the agreement contains a comprehensive and legally binding chapter on trade and sustainable development.

'The parliamentary approval process will be initiated immediately so that Switzerland can ratify the agreement by 2025 at the latest,' it said.