Partner: CUTS International
This is a continuation of SDPI-CUTS International joint studies. Keeping in mind the key findings of the study on Cost of Economic Non-Cooperation to Consumers in South Asia, the goal of this project is to generate better political buy-in for enhanced and improved intra-regional trade in South Asia by conducting some focused advocacy on customs-related and other procedural non-tariff barriers targeting some key stakeholder groups.
The objective of the study is to conduct a set of focused result- and action-oriented activities on selected issues of customs-related and other procedural non-tariff barriers hindering intra-regional trade in South Asia so as to ensure some tangible and incremental progress towards reducing cost of doing trade within the region.
In order to achieve the goal and objectives, the study will focus on customs-related and other procedural non-tariff barriers, which constitute some significant part of the cost of doing trade within the region. According to some estimates, non-tariff barriers constitute more than 75 per cent of cost of doing trade within South Asia.
In order to achieve some concrete results, the project will focus on the following two types of impact of procedural NTBs:
- Impact on trade logistics (including transportation and documentation): Expenditure is in excess of those normally required in the delivery and clearance process, especially delays at border clearance through difficult documentation procedures. Starting from a general lack of awareness about trade prospects because of limited market information, conduct of trade is made difficult because of a number of excessive procedures and difficult customs clearance process.
- Impact on trade financing: There is a lack of proper financial instruments to facilitate trade and reduce foreign exchange risks. Currently, trade financing is mostly mediated by third country banks, resulting in unjustified user fees, etc. Interest charges as well as documentation costs of trade financing are also high because of the lack of arbitration facilities.
Based on the above-stated goal, objective and focus, the project will conduct the following activities (including following particular processes and methodology, as described below, in conducting them):
In partnership with a group of like-minded organisations (viz. Institute for Policy Advocacy & Governance, Bangladesh; South Asia Watch for Trade, Economics & Environment, Nepal; Sustainable Development Policy Institute, Pakistan; and Institute for Policy Studies of Sri Lanka) and other like-minded groups in respective countries, the project will focus on top five traded commodities between India and four other South Asian countries, viz. Bangladesh, Nepal, Pakistan and Sri Lanka. In other words, the focus will be on top five exports from India to each of these four countries and top five imports from each of these four countries to India.