Is zero import duty for Bangladesh a threat for India?

by Apparel Resources News-Desk

27-August-2019  |  2 mins read

Third countries taking advantage of zero import duty for Bangladesh
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The Directorate of Revenue Intelligence (DRI) has raised its doubts over Indian import of garments from Bangladesh.

Currently, Bangladesh is allowed certain concessions on duty under a free-trade pact and it is possible that other countries are leveraging this in order to import their goods into India.

To stop this from happening, the DRI has instructed the customs wing to cautiously examine the origin certificates issued for such consignments by Bangladeshi trade bodies.

“There is concern over growing cheap imports from third countries via Bangladesh. The agency wants to ensure that only Bangladeshi origin imports are permitted the concessions,”said a Government official.

Earlier this month, the DRI had issued a show cause notice to Future Enterprises on 83 garment assignments that were routed through Bangladesh but were originally imported from a third country.

Many countries have been taking undue advantage and hence, the customs department has been alerted and will keep a close watch on all garment imports under the South Asian Free Trade Pact.

The South Asian Free Trade Agreement mandates 30 per cent local value addition in least developed countries for import by other nations.“Such imports using the FTA route without any value addition not only defeat the whole objective of the agreement but also hurt the ‘Make in India’ initiative,” commented the Government official.

India has been faced with similar issues earlier with the India-Thailand FTA regarding gold jewellery import and the India-Asean accord with regard to consumer durables imports.

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