India blamed for low intra-regional trade

Indian officials have said that the union government can´t impose any rule on state governments even though the latter ones are acting against the spirit of bilateral trade agreements between Nepal and India.
“The union government can´t force state governments on issues related to bilateral trade agreements," Sandep Kumar, commissioner (international customs division), Central Board of Excise and Customs under Department of Revenue of the Indian government, said.
Talking about country positions on non-tariff barriers (NTBs) - different obstacles that traders face other than customs duty - in South Asia at a regional conference here on Thursday, Kumar said the Indian government may not always be ready to remove all kind of NTBs.
"NTBs are always not bad, sometimes they serve some specific interests of the country," Kumar told a conference organized jointly by CUTS International, a think tank based in India and The Asia Foundation.
Nepali traders have been facing several hurdles due to different provisions enforced by the Uttar Pradesh (UP) government. Medicinal herbs worth around Rs 350 million was stuck in Nepalgunj customs point for several months last year after the UP government introduce a new law that contravenes the bilateral trade agreement between the two countries.
“The state governments can formulate their own laws,” Kumar said, answering a query on whether the whether the central government can intervene when the state governments formulate laws that go against the spirit of bilateral agreements.
Meanwhile, businessmen, officials and experts from the South Asia region have said most of the NTBs are outcomes of policies created by the government with political intention.
“Political intention is the main reason behind introduction of NTBs,” Robina Ather, joint secretary at Customs and Trade Policy under Pakistan´s Ministry of Commerce, said. “It is because of India that intra-regional trade stands at such a low volume.”
Businessmen from the region have urged governments and stakeholders to focus on development of cross-border infrastructure and ease visa process for the traders. "The governments of all the countries from the region should put effort on cross-border infrastructure development," Kosala Wickramanayake, former president of Federation of Chambers of Commerce and Industry of Sri Lanka, said.
Meanwhile, officials and experts from the region have urged for diversification of products and markets instead of competing in the same market with almost same kind of goods. They have also stressed the need to focus on intra-regional trade by removing different barriers.
"Most of the countries from the region produce same kind of products such as textiles and compete for the American or European market," Indira Murthy, director of Foreign Trade at India´s Department of Commerce, said.
Bipul Chattargee, deputy executive director of CUTS, said SAARC Chambers of Commerce and Industry should assist the governments in order to minimize NTBs.