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Country of Origin Tag on all Imports

August 20, 2019

A step towards countering large scale dumping of sub-standard goods, it is being reported[1] that India might make it mandatory to specify the country of origin i.e. made in (country) tag on all imports into the country as non-preferential rules of origin are being drafted.

WTO: Agreement on Rules of Origin

If the rules in respect of origin of imports and their application are harmonised it would ensure elimination of unnecessary obstacles in trade as well as facilitate the flow of international trade. It is pertinent to mention that the members of the World Trade Organisation (WTO) have agreed to discuss and implement harmonised non-preferential rules of origin in the Agreement on Rules of Origin[2]. Further, it is worth noting that about 40 WTO members presently implement national rules of origin for non-preferential purposes.

Benefits expected from making Country of Origin tag mandatory

If an anti-dumping duty is imposed on imports from a certain country, the traders try to route the products through some other country from where the import after tariff restrictions costs cheaper as compared to direct import from the country of origin to India.

Framing of specific rules in this regard would be a step welcomed by the custom authorities as it will help them in effectively monitoring imports and restricting items that do not conform to the quality and standards of India. This will also enable the custom authorities to impose duty wherever necessary.

Hence, the following benefits can be expected to be arising from these rules:

  1. Identification of country of origin;
  2. Identification of imported items which do not meet the prescribed standards/ quality;
  3. Imposition of quality standards as well as technical standards for imported items;
  4. Implementation of duties where required;
  5. Implementation of anti-dumping framework and penalising violators.

[1] Refer: https://economictimes.indiatimes.com/news/economy/foreign-trade/india-for-made-in-tag-on-all-imported-items/printarticle/70636346.cms

[2] Full text available at: https://www.wto.org/english/docs_e/legal_e/22-roo_e.htm

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