The India-UK Comprehensive Economic and Trade Agreement has introduced a ‘co-equal’ rule or product-specific origin norm to offer greater flexibility to certain goods such as chemicals, pharmaceuticals, paints, essential oils and iron & steel. The rule will allow a producer of a good to meet any of the criteria of origin to claim benefit under the FTA.
The origin rules are vital for checking any circumvention of FTA rules and flow of substandard imports into India.
India’s pact with the UK is different from its earlier trade pacts, which had simple rules of origin linked to the wholly-obtained criterion from the trade partner country, value-added criteria or change in tariff heading parameter, which means transformation of a product leading to a change in its duty classification. While there are references to such rules in India’s trade pact with Australia, it is for the first time that such elaborate rules have been created.
Content Source: economictimes.indiatimes.com