Government Calls for Competitiveness in Domestic Industry Amid Tariff Debate

New Delhi, Dec 12 (KNN) The government has urged the domestic industry to reflect on its competitiveness as calls for higher import tariffs persist, despite India’s tariff rates aligning with global averages.

Addressing the issue, Amardeep Singh Bhatia, Secretary of the Department for Promotion of Industry and Internal Trade, expressed concern over repeated industry demands for tariff hikes.

“The weighted tariff has come down substantially and is at the world average level, yet pressures for increases persist. We need to examine why these demands arise and why the industry has not become competitive,” Bhatia stated at the CII Global Economic Policy Forum.

India’s average tariffs on non-agriculture imports dropped to 13.5 per cent in 2023 from 14.7 per cent in 2022. Similarly, agricultural tariffs fell marginally to 39 per cent from 39.6 per cent.

However, on a trade-weighted basis, agricultural tariffs rose significantly to 65 per cent from 48.5 per cent, while non-agriculture tariffs edged down to 9 per cent from 9.2 per cent.

Comparatively, the global average tariff on non-agriculture products hovers around 2.5 per cent, with agricultural tariffs being higher.

Highlighting the government’s efforts to integrate India into global supply chains, Bhatia noted substantial work in tariff reductions. He also pointed to plans for enhancing land availability, with over 4,000 industrial parks nationwide.

States like Tamil Nadu have implemented effective land pooling and reclamation practices to support industrial growth.

Rakesh Bharti Mittal, Vice Chairman of Bharti Enterprises, emphasised the high cost of doing business in India, urging better implementation of reforms at the state level.

Bhatia acknowledged this concern, emphasising the Business Reforms Action Plan (BRAP), which monitors state-level ease of doing business through 280 identified reform actions.

States such as Odisha and Telangana were highlighted for their effective single-window systems, but Bhatia noted significant gaps remain. He reiterated the government’s commitment to fostering a competitive, business-friendly environment.

With the December GST Council meeting on the horizon and discussions around social security codes for gig workers, these developments underscore the government’s focus on structural reforms to boost India’s economic landscape.

(KNN Bureau)