India could have made good use of environmental regulations to control the effect of WTO agreement on the Indian economy
the Union minister of commerce and industry, Murasoli Maran, announced India's export and import (exim) policy on April 1, 2001. In the new policy, quantitative restrictions (qrs) from 715 items have been removed. Among them are at least 130 food items. However, 520 items remain in the prohibited list -- they cannot be imported. The policy has come in for flak from a range of experts for not taking environmental considerations into account.
In 1997 India's qr regime came in for scrutiny. The us had filed a case against India in the World Trade Organisation (wto) against qrs on imports. These sprang from India's balance of payment condition, which India had notified to wto in May 1997 and which allowed it to not conform with wto agreements. In 1999, India lost the case in a wto dispute settlement body. The Indian government appealed and, as a result, was given 18 months to comply with the rulings. This was to be done in two phases. In the first phase, the government removed qr s from 714 items on April 2000. In the second phase beginning April 2001, it removed qrs from 715 items.
"The new exim policy has not taken cognisance of the health and environmental concerns. Look at the mechanism we have to monitor the quality of products like agricultural goods. When we cannot monitor our own products, it remains to be seen how we can check the quality of goods coming from other countries," says Abhijit Sen, professor at the Jawaharlal Nehru University (jnu) and former chairperson of the Commission on Agricultural Costs and Prices. He says the policy does not show the vision required to anticipate any crisis because the precautionary principle hasn't been taken into account.
Kanwaljit Singh, coordinator of the Public Interest Research Group, a Delhi-based non-governmental organisation, says the exim policy is a total surrender -- neither environmental concerns nor livelihood concerns have been addressed.
The import of second-hand cars is subject to health, environmental and road safety regulations, provided these are also binding upon domestic carmakers. These grounds are acceptable according to wto , and several countries employ these in the post-free trade regime. In effect, these amount to new forms of protectionism. For free trade exists only on paper, and most developed countries run veritable mercantile regimes that protect the interests of their industries, says M K Venu, editor of e-indiabiz.com , a business portal.
Experts feel the government has gone out of its way protect the domestic auto sector. The auto sector had its way in getting stringent measures formulated against second-hand cars. The Society of Automobile Manufacturers (siam) lobbied heavily for increasing customs duty on imports on the sale of second hand cars. The government responded enthusiastically and the policy protects the Indian manufacturers with duties as high as 180 per cent, ignoring the environmental concerns.
"The government chose to protect the domestic industry against interests of the consumer," says Veeresh Malik, a car consultant. No mention of emission norms has been made or laid down as a prerequsite for importing a car into India, he points out. Analysts feel that India has missed a chance to make Indian auto industry more environment-friendly and help it to upgrade. "These problems require a sound understanding of the ever-changing dynamics of global trade and its impact on the environment. India's commitment, as a member of the wto , to phase out qrs on imports of second hand cars is one such problem," says Anil Agarwal, chairperson of the Centre for Science and Environment. The environmental barriers could have gone a long way in preventing the entry of second-hand cars in our country, especially from Japan, which will adversely affect the Indian industry. All the government had to do was to make it mandatory that only Euro iii compliant vehicles can be sold in India and ask industry to move to Euro iii by 2002, adds Agarwal. The industry sought customs duty on these cars and the government agreed to it without consulting the environmental community. He says uniform emissions norms throughout the country could be a good way of checking entry of dirtier cars.
As only three-year-old cars come in unless India upgrades its emission norms quickly and makes euro iii emissions or even more stringent standards mandatory, it can become the world's biggest dumpyard of obsolete and polluting technology.
"The lifting of quantity restrictions on the import of foreign goods would have an adverse impact on the production of Indian goods leading to large-scale closure of small-scale industries in the country," fears Sharad Joshi, chairperson of the National Task Force on Agriculture, while speaking at a public rally. "Although the Indian government has made it clear that it will not allow import of genetically-modified food, we do not have the system to scrutinise and inform the people about the nature of the product," says Suman Sahai, convenor of Gene Campaign, a non-governmental organisation based in Delhi.
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