Custom duty hike in Bangladesh hits orange exports in W.Bengal

Indian exporters have appealed to the Bangladesh Government to reduce the hiked custom duty imposed on oranges to facilitate cross-border trade between the two countries.

Exporters are facing the brunt, as North Bengal is accountable for millions of rupees every year through the trade of oranges between the months of November and January.

The fruit is found in abundance in the hilly sub-divisions of Darjeeling, Kerseong and Kalimpong during this time of the year.

Recently, there was significant improvement in trade relations between the two countries.

In 2010-11, two-way trade crossed the USD 5 billion mark as a result of a significant increase in Bangladesh's exports to India (68 percent over the previous year) and India's exports to Bangladesh (43 percent over the previous year).

Currently, Bangladesh imports products worth over USD 4 billion from India while India imports products worth less than USD 1 billion, annually.

Irate exporter Baburam Prasad said: "There is lot of demand for the oranges but this year it is costing too much. The export is not taking place due to high custom duty. We hope that the duty gets reduced but it is not happening. If the government takes a step then it will reduce."

"We demand that if Bangladesh reduces the duty then export of oranges can take place," added Baburam.

Every year, the transaction with Bangladesh concerning the orange trade increases to 20 million.

But unfortunately, this year, the export is very poor due to the customs duty of Rs. 40 per kilogram charged on oranges by Bangladesh Customs.

Another exporter, Biddut Das, said: "Earlier oranges in huge quantities were exported to Bangladesh due to its demand. But exports have reduced, as custom duty is high. Oranges are being exported directly from Bhutan, as the custom duty is not too high."

Tariff concessions granted by India to Bangladesh under SAFTA (South Asian Free Trade Area) (as SAARC LDC) include a zero-duty market access for all, but 480 items in the sensitive list. India had further increased the duty-free access to 10 million pieces of readymade garments (RMG) from Bangladesh every year.

India is upgrading seven main borders Land Customs Stations (LCS) as Integrated Check Posts (ICPs) at a total cost of rupees 467 crores (rupees 4.67 billion). ICPs will have facilities for immigration, customs, parking, banks, warehousing, quarantine and fuelling etc.

The measure will help improve trade with Bangladesh across West Bengal, Assam, Meghalaya, Tripura and Mizoram.

Bilateral investment will be facilitated by the recent conclusion of the 'Bilateral Investment Protection and Promotion Agreement' and 'Convention for the Avoidance of Double Taxation' between the two countries.

It is hoped that Bangladesh investments in India will increase with easing of local currency transfer restrictions.

Given the geographical proximity, warm and friendly ties, availability of workforce and investment-supportive atmosphere, the quantum of Indian investment and trade with Bangladesh is further expected to improve for mutual benefit.