India has formally ratified the WTO’s Trade Facilitation Agreement, which aims at easing customs procedures to boost commerce. India is the 76th WTO member to ratify the TFA.
What is Trade Facilitation Agreement (TFA)?
- The TFA is the WTO’s first-ever multilateral accord that aims to simplify customs regulations for the cross-border movement of goods.
- It was outcome of WTO’s 9th Bali (Indonesia) ministerial package of 2013. The agreement includes provisions for:
- Lowering import tariffs and agricultural subsidies
- Abolish hard import quotas
- Reduction in red tape at international borders
- The ratification will supplement India’s ongoing reforms to bring in simplification and enhanced transparency in cross border trade in goods.
- It will further help India to boost economic growth by reducing trade costs and integrate it into the global economy.
- The implementation of the TFA has the potential to create US 1 trillion dollars’ worth of global economic activity which may add 21 million new jobs and lower the cost of carrying out international trade by 10 to 15 per cent.