In a bid to reduce the trade deficit, the government is now taking a closer look into the vast segments of India’s imports that have not yet been properly categorised and remain immune to restrictions.
Thousands of import categories are labeled simply “others” in the official trade classification handbook. Many of these bring in goods worth Rs 100 crore or more. But, little data is available on what these are, said sources in the government.
The issue has become important as the commerce department examines if Chinese goods are being routed to Indian markets through other nations.
To find out what goods are exported under these categories, the commerce department has asked the revenue department to provide details of inbound shipments. The Central Board of Indirect Taxes and Customs, which is under the revenue department, maintains databases on merchandise trade through India’s international ports.
India follows the internationally standardised Harmonized Commodity Description and Coding System, also known as the Harmonized System (HS) of tariff nomenclature to classify traded products.
The system consists of separate levels of data classification to categorise more than 10,000 separate categories of products. Latest official figures show 2,433 cases all classified under the “other” category or not clearly mentioned.
The first six digits of the HS tariff number are used universally. Each country may then add up to six more digits according to its tariff and statistical needs
India has remained at the eight-digit level, while major exporting nations have graduated to even more detailed higher levels of trade classification.
Turkey uses a 12-digit HS code system. Most major developed economies such as the European Union, the United States, South Korea, Canada, and China have standardised 10-digit codes.
“There have been talks of expanding the trade classification list by making it more detailed. This will undoubtedly help pinpoint trade flows and allow for better and quicker policy measures to address issues such as dumping,” a senior official said.
India’s overall imports stood at $514 billion in 2018-19, up by 11 per cent from the previous year.
As fears of runaway imports plagued policymakers last year, duties on inbound goods were raised as many as six times. This was followed by a duty hike imposed on 29 primarily high-value agricultural imports from the US earlier this year.