Trade Agreements It s impact on Machine Tool Industry

Trade Agreements It’s impact on Machine Tool Industry

Impact of the recently concluded trade agreements between India-Korea, India-ASEAN and India-Philippines on the custom duty for machine tool industry. Now the imports are become more cheaper than before. Source: Ministry of Commerce, India

INDO-ASEAN-CUSTOM DUTY NT-1=HS Codes 8456, 8457, 8458, 8459, 8460, 8461, 8462, 8463, 8464 & 8465 NT-2=HS Codes 8459, 8460, 8461 & 8465 Member countries: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand Vietnam Source: Ministry of Commerce, India

INDO-PHILIPPINES-CUSTOM DUTY NT-1=HS Codes 8456, 8457, 8458, 8459, 8460, 8461, 8462, 8463, 8464 & 8465 NT-2=HS Codes 8459, 8460, 8461 & 8465 Source: Ministry of Commerce, India

INDO-KOREA-CUSTOM DUTY E-0= HS Code 8456 & 8464 E-5=HS Code 8457, 8458 & 8462 E-8=HS Code 8456, 8457, 8458, 8459, 8460, 8461, 8462, 8463 & 8465 Red=HS Code 8459, 8461 & 8462 Source: Ministry of Commerce, India

INDO-SINGAPORE-CUSTOM DUTY Source: Ministry of Commerce, India

Impact Indo-ASEAN: Member countries: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand Vietnam Impact: No such major impact; however watch Singapore and Thailand. Indo-Philippines: It is part of the ASEAN Free Trade Agreement but the tariff structure is little different. Impact: No such major impact Indo-Korea: Korea is a big player for machine tools, after this trade agreement the tariff structure for machine tools will be subdivided into four categories as follows; But maximum number of machine tools will be coming under E-8 Category. Impact: Major impact

Impact Indo-Singapore: It is a separate Free Trade Agreement between India and Singapore, which is already into force from 2007 Impact: Watch it carefully as Singapore has got manufacture base for major machine tools companies. Indo-Mercosur: Full Member countries: Argentina, Brazil, Paraguay and Uruguay Applying for full membership: Venezuela Associate members: Bolivia, Chile, Colombia, Ecuador and Peru Observers: Mexico Impact: No such major impact as the tariff reduction is for only few machine tools. 84591000, 84596910, 84596920, 84596930, 84596940, 84596990, 84612019, 84622910, 84622920, 84622930, 84622990, 84629990, 84639090 for these HS Codes there is a discount of 20%. Indo-EU: Member countries: Austria, Belgium, Bulgaria, Cyprus The Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, The Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, The United Kingdom. Impact: This treaty is in a draft stage and IMTMA has already registered it’s concern to the ministry. Impact can only be known once the draft is finalised.

Agreements in the pipeline India-China • The Joint Study Group was constituted and MEA is the nodal Ministry for the JSG. • In pursuance to the recommendations of the JSG, Six meetings of the JTF have taken place. In its sixth meeting held on 21 st and 22 nd October, 2007 the JTF has finalised its draft report on issues covering Trade in Goods, Trade in Services, Bilateral Investment, Trade Facilitation and Economic Co-operation. India-Australia • India and Australia agreed in early 2008 to set up a Joint Study Group comprising government officials and research organisations to explore the feasibility of Free Trade Agreement (FTA) between the two countries. • The JSG met twice since then and has agreed to submit the Report by mid 2009. India-New Zealand • JSG was set up in early 2008 which met thrice and has submitted the Report in February 2009. India-Indonesia • Focusing on strengthening India’s ongoing engagement with ASEAN, the two countries could also examine the possibility of entering into a bilateral comprehensive economic cooperation arrangement in the long term. • JSG was accordingly constituted in October 2007 and 4 meetings of the JSG have been held so far. The JSG is expected to submit its Report by August 2009. Source: Ministry of Commerce, India

Rank 18 Source: Gardner Publication, Inc

Rank 9 Source: Gardner Publication, Inc

References: Indo-ASEAN trade agreement; Ministry of Commerce http: //commerce. nic. in/trade/international_ta_indasean. asp Indo-Philippines trade agreement; Ministry of Commerce http: //commerce. nic. in/trade/international_ta_indasean. asp Indo-Korea trade agreement; Ministry of Commerce http: //commerce. nic. in/trade/INDIA%20 KOREA%20 CEPA%202009. pdf Agreements in pipeline; Ministry of Commerce http: //commerce. nic. in/trade/international_ta_pipeline. asp HS CODE 8456 8457 8458 8459 8460 8461 8462 8463 8464 8465 DESCRIPTION Machine-tools for working any material by removal of material, by laser or other light or photon beam, ultrasonic, electro-discharge, electro-chemical, electron beam, ionic-beam or plasma arc processes Machining centres, unit construction machines (single station) and multi station transfer machines for working metal Lathes (including turning centres) for removing metal Machine-tools (including way-type unit head machines) drilling, boring, milling, treading or tapping by removing metal, other than lathes (including turning centres) of heading 8458 Machine-tools for deburring, sharpening, grinding, honing, lapping, polishing or otherwise finishing metal or cermets by means of grinding stones, abrasives or polishing products, other than gear cutting, gear grinding or gear finishing machines or heading Machine-tools for planing, shaping, slotting, broaching, gear cutting, gear grinding or gear finishing, sawing, cutting-off and other machine tools working by removing metal or cermets, not elsewhere specified or included Machine-tools (including presses) for working metal by forging, hammering or die-stamping; machine-tools( including presses) for working metal by bending, folding straightening, flattening, shearing, punching or notching; Presses for working metal or meta Other machine tools for working metal or cermets without removing material Machine tools for working stone, ceramics, concrete, asbestos cement or like mineral materials or for cold working glass Machine-tools (including machines for nailing, stapling, glueing or otherwise assembling) for working wood, cork, bone, hard rubber, hard plastics or similar hard materials