Custom duties freeze on e-transmissions harms developing nations, India must oppose extension: SJM
New Delhi: The Swadeshi Jagran Manch (SJM) Friday said that extension of moratorium on custom duties on electronic transmission would now be “very detrimental” to the interest of developing countries, and India must oppose it at the upcoming WTO ministerial conference.
In a monograph published by it, the RSS-affiliate said that under the present trade scenario it can be easily concluded that not imposing custom duty on electronic transmission would be a losing proposition for India.
The issue cannot be ignored “any longer” in view of the prevailing trend of physical trade of digitisable products “falling substantially” over the period, resulting in a decline in tariff revenue for India, it said.
While emerging areas such as cyber security services, data annotation market, fintech market and global hub for electronic system design and manufacturing are going to make India a leading digital economy, the banking, insurance, manufacturing, retail, media and entertainment all are adopting new tools and technologies including 3D printing, said the monograph, titled ‘Moratorium On Customs Duty On Electronic Transmission’.
“From India’s perspective, we have to understand that this issue of moratorium on custom duties on electronic transmissions cannot be ignored any longer. Today, it’s the time of the fourth industrial revolution, which will come through digital industrialization. We must not lose this opportunity,” the SJM monograph adds.
It noted that the moratorium on the imposition of customs duty on electronic transmission continues since 1998 as the World Trade Organisation (WTO) members are yet to have a consensus on the definition of electronic transmissions even though the United Nations Conference on Trade and Development in a research paper in 2019 had made an attempt to define.
In the present scenario, it said, the UNCTAD’s definition of electronic transmission appears to be “quite reasonable” and implementation of levy of custom duties on them is “feasible”.
“Now the 12th Ministerial Conference of WTO is expected to be held soon. India has to unequivocally say that the moratorium on customs duty on electronic transmission is very detrimental to the interest of developing countries and a decision in this regard should be made immediately,” the SJM monograph said.
It said the imposition of tariff on electronic transmission will be the first condition for success in the fourth industrial revolution.
“When developed countries can go to any extent in the interest of their companies and their economy and put pressure on countries like India, we also need to stop developed countries from disrupting our industrialisation, by taking other developing countries along,” it added.
SJM co-convenor Ashwani Mahajan and Anil Sharma, a chartered accountant, are the joint authors of the monograph, published by the Swadeshi Jagran Foundation.
“Based on the present export from and import of goods and services in India digitally and considering the growth prospects of the ICT sector in India, it can be easily concluded that not imposing custom duty on electronic transmission will be a losing proposition for India,” they noted.
Therefore, India along with “its ally Africa Group” should “strongly” oppose extension of moratorium on custom duties on electronic transmission at all forums of the WTO, they added.