Lately, Iran and India held a new round of negotiations on
signing a preferential trade agreement (PTA) between the two sides. Initiated
in 2016, the negotiation on this agreement is said to be in the final stages,
and the two sides hope that the list of the commodity items entitled to
preferential tariffs will be finalized in the next round of the talks.
During the fourth round of the negotiations, which was also
held in Tehran, the two countries discussed draft text of the agreement which is
to reduce tariff rates by 25% to 45%. In the fifth round of the talks held at
Iran’s Trade Promotion Organization (TPO), some clauses of the pact remaining
from the previous talks were reviewed and discussed, said Hossein Bamiri, the
secretary of TPO’s Iran-India Desk.
As reported by TPO, Iranian delegation participating in this
round included Reza Seyed Aqazadeh, director general of TPO’s Asia-Pacific
Office, Hossein Bamiri, the secretary of TPO’s Iran-India Desk, Mir-Hadi
Seyedi, TPO’s advisor in international affairs, Zahed Talaban, international
expert at TPO, and representatives from the ministries of agriculture and
health, Veterinary Organization, National Standard Organization, and some other
organizations.
Signing the preferential trade agreement lays a competition
ground for Iranian companies to enter the Indian market, Bamiri said, adding,
“In this round of the talks we tried to reduce tariffs for those commodity
items that we have high potential in their production and export.”
“If tariffs are reduced and other extant barriers are
removed, we can strengthen our entrance to the Indian market through the PTA”,
the official emphasized.
Iran’s major exports to India are oil, fertilizers and
chemicals while imports include cereals, tea, coffee, spices and organic
chemicals.
The value of India’s exports to Iran stood at US$2.65
billion in 2018, while imports were valued at US$11.11 billion. The trade
imbalance is mainly because of India's import of oil from Iran.
Signing this PTA is of great significance for India, as the
country will be able to diversify its export basket which is now limited to
agricultural products, Trade Promotion Council of India (TPCI) Chairman Mohit
Singla has declared.
"With a carefully designed PTA, strategic products such
as leather, textiles and readymade garments, which attract very high duties in
Iran can become naturally competitive and India will be able to leverage its
export strengths," The Economic Times reported quoting Singla.
Preferential trade between the two countries is a priority
in India’s future plans for trade with Iran, according to Indian Ambassador to
Tehran Gaddam Dharmendra.
The two countries were supposed to finalize the preferential
trade agreement by the end of 2019, a target that has not come true in due
time.
Addressing an Interactive Session on Business Opportunities
in Iran held in New Delhi in last August, Iranian Ambassador to India Ali
Chegeni had said, “Very few formalities remaining to be completed on this front
will be accomplished shortly with 5th round of talks between the authorities of
the two countries here in New Delhi before it becomes a reality by end of 2019.”
While the agreement has not been reached at the projected
time, the two sides resolve to finalize it as soon as possible to further
promote bilateral trade.
