India-UAE Pact to Facilitate Mutual Recognition of Professional Degrees
The pact, which is due to come into force on May 1, will remove tariffs on 90% of Indian exports by value to the UAE, covering sectors such as gems and jewellery, textiles, leather and engineering products.
Trade and Industry Minister Piyush Goyal on Sunday announced the unveiling of the Comprehensive Economic Partnership Agreement (CEPA) between India and the United Arab Emirates in Dubai. The pact, negotiated in a record time of 88 days, was signed between the two parties on February 18. It is the first major FTA signed by the Prime Minister Narendra Modi-led government since he came to power in 2014 and is expected to benefit Indian goods worth around $26 billion which are subject to import duty. 5% by the United Arab Emirates.
India has extended a 1% tariff concession for gold imports from the United Arab Emirates up to 200 tonnes of inbound shipments under the pact. He also offered significant tariff concessions on dates, petroleum products, petrochemicals, metals and minerals in the UAE.
The agreement imposes up to 40% value added on most goods and full procurement criteria for agricultural products, to prevent misuse of CEPA. This is intended to prevent the re-export of goods imported from other countries by taking advantage of reduced tariffs without added value. It is also the first time that an Indian FTA includes a specific “melt and sink” condition for steel products to prevent abuse of the treaty. Under this, the steel will need to be melted and cast before being shipped.
Only direct exports will be eligible for concessions under the agreement. Transshipped or re-exported goods were excluded from the pact.
The agreement also provides for a permanent safeguard mechanism for certain goods. It covers government procurement, intellectual property and dispute resolution mechanisms.
The UAE has proposed the elimination of duties on more than 97% of its tariff lines, which represent 99% of Indian exports to the UAE by value.
The pact also listed 17 agencies on the Indian side in addition to the export inspection board, including the spice board, coir board and tobacco board, to issue certificates of origin to exporters through digital way, facilitating faster customs clearance and trade.
The classification by chapter of the subjects in the agreement will allow an easier adaptation by the pact, according to the industrialists. “This will make it easier for the industry to adapt and also eliminate interpretation issues to a large extent. This will lead to much better use of CEPA by India and the UAE,” said A Sakthivel, Chairman of the Federation of Indian Export Organizations. Also, the inclusion of a few government agencies for issuing certificates of origin will help streamline the process.
“As these certificates will be issued online, verification, if necessary, will be expedited, which will help trade. Better oversight and use of the FTA would also be possible through digital intervention,” Sakthivel said.
Under this pact, Indian pharmaceutical and medical products will get regulatory approval within 90 days which have been approved in developed jurisdictions such as US, UK, EU, Canada and India. Australia.
Publishing the text early in the financial year would help industry leverage CEPA to boost exports, said Confederation of Indian Industry chief executive Chandrajit Banerjee. “A separate pharmaceutical sector annex and emphasis on paperless trade with digital trade cooperation would have a significant positive impact on boosting bilateral trade and investment,” Banerjee said.
One of the main goals of the agreement is to deepen bilateral cooperation to provide more business opportunities for small and medium-sized enterprises, he said. “This would not only help improve our exports, but also generate more employment opportunities in the sector,” Banerjee said.
Indian service providers will have access to approximately 111 sub-sectors of the 11 major service sectors of the UAE, such as business services, communication services, construction and related engineering services, distribution services , educational services, environmental services, financial services, health and social services, tourism and travel services, recreational, cultural and sporting services, and transport services.
The pact also includes the facilitation of mutual recognition of “education or experience, qualification requirements and procedures, and licensing requirements and procedures” in the service sectors, including architecture, engineering, medicine (doctors), dentistry, accounting and auditing, nursing, veterinarians and business. secretaries within a reasonable time.
“The parties will periodically report to the joint committee on progress and obstacles encountered,” the agreement says.
It is good that the pact includes the mention of MRAs for service sectors, but this does not guarantee success because no deadline is specified for their signature, underlined Arpita Mukherjee, Professor, ICRIER. “After several years, we only got one nursing MRA with Singapore,” Mukherjee said.
Download the app to get 14 days of unlimited access to Mint Premium absolutely free!