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China's border trade with Myanmar robust than India

"Huge information gap" between traders and the custom duty is one of the reasons for India's poor trade with Myanmar

IANS  |  New Delhi 

File Photo: Reuters
File Photo: Reuters

As prepares to celebrate the silver jubilee of its partnership with in a big way, a key border link with Myanmar, the closest neighbour of the vibrant Southeast Asian bloc, continues to be hobbled by infrastructure and other issues -- 22 years after it was launched.

India's border with takes place mainly through Moreh, in Manipur's Chandel district, which links with Tamu, located in Sagaing in northwest There is another border point through Zowkhathar in with the corresponding point Rhi in Myanmar, but Moreh is the biggest border point.

Though and signed the border agreement on January 21, 1994, and it was made operational the following year, the bilateral border figure stands at $50 million -- a poor comparison to Myanmar's with China, which was around $6 billion last year.

has four border trading points with China, of which the one at Muse, in northern Shan state, is the biggest. Around 80 per cent of Myanmar's formal overland with passes through this post that links with Ruili, in China's Yunnan province.

While has pumped in massive amounts of money to build modern infrastructure at Ruili and also in Yunnan province to boost connectivity with Myanmar, the infrastructure at the India-border post, Moreh, is still inadequate. An Integrated Check Post (ICP) at Moreh has been in the works for the past 10 years and is yet to be completed.

Besides the difficult terrain and militancy that adversely affect border at Moreh-Tamu, in December 2015 officially put an end to the barter system, or trading of goods without exchange of money.

According to Myanmarese media reports, the ending of barter "killed" India-border

Professor Priyoranjan Singh, an economist at Manipur University, says that since the Government of notification ending barter trade, "the present state is that formal trade, or normal official trade, stands at zero, and informal, or illegal -- or head load -- is going on".

He told IANS that there was a "huge information gap" between the two sides, including among the traders. "Our own Indian customs agency does not know the customs duty that imposes on Indian goods," he said.

Singh, who has expertise in the field, feels that "seriousness is not there" in on boosting border trade, while exhibits "huge seriousness, which is something likes".

Gautam Mukhopadhyay, the former Indian envoy to Myanmar, says there are reasons for China's border with being more robust than

"First, Yunnan is a much better connected and more productive gateway from to than the Northeast of to Secondly, for any Northeastern state of to match in cross-border trade, the region has to become a net producer than the consumer, and better connected to the main productive regions of India," Mukhopadhyay said.

He said efforts were being made in that direction. "But it will take some time and better coordination between our development, commercial and strategic policies for us to match "

He said the government has tried to address the issue of low volumes by liberalising cross-border and moving to the Most Favoured Nation status, but there was a "need for a reliable system to determine countries of origin of goods". A lot of goods from are available in the markets in the region.

Economist Ram Upendra Das, head of the Centre for Regional Trade, an autonomous institute under the Commerce Ministry, in his report on 'Enhancing India-border trade' released last year by the ministry, says: "A major cause of discontent among local traders is that the pace of construction of Moreh ICP is very slow."

Das told IANS that "it is very important that border is conducted through formal channels", which would help increase the volume as has slashed the tariff in a majority of items to zero, which means no

"There are an information gap and lack of understanding among the traders" on the benefits of conducting through the formal channel, he said. The informal would also give rise to corruption, in the form of levy imposed by militant groups and bribes, he added.

On developing the infrastructure in Myanmar, Mukhopadhyay says: "has made huge investments into power and extractive industries for its own interests, but very little into employment-intensive industries that really benefit has been able to convert its more selfish investments into greater political clout than This is something we need to think about."

First Published: Fri, December 22 2017. 12:54 IST