IGNOU : M.COM : IBO 1 : UNIT 17 : Q - 2. What has been the Indian experience in the field of trade vs environment ? Outline briefly the steps India can initiate to tackle the issues that can surface in this context.

 

Ans. India as one of the important developing country suppliers to world markets, has shown some concern on the introduction of what it regards as new issues, such as environment, child labour, labour standards and human rights in the international trade agenda. Such issues could easily negate the advantages secured by the lowering of tariff barriers and phasing out of the quota regime obtained through hard bargains in the Uruguay Round of Negotiations. - These issues could act as effective non-tariff barriers if used indiscriminately. On subjects like environment, developing countries still need considerable lead time to build the requisite technical and technological competence to come upto developed country standards. India perhaps, is only marginally better placed in this regard than other developing countries.

Indian export apprehensions, principally lie in the fact that some of the sectors in which the country had placed specific export emphasis, viz leather and leather products, textiles and garments, agro-based items and chemicals etc., happen to be those wherein the developed countries are seeking more stringent environmental standards and regulations. It would be pertinent to illustrate this fact with a few concrete Indian experiences in this regard.

Leather goods : During the late 1980's Germany introduced an "environment standard" which banned the use of PCP (Penta-chloro phenol) chemicals used in leather tanning. It is reported that it took India over five years and an increase of 20per cent in capital cost to adjust to the new technological standards required.

Textiles and Garments : A study made by the Apparel Export Promotion Council of India on eco-standards in the US and Europe, found that the emerging International eco-standards - in this sector will ultimately affect all stages of textile production in India, from cotton . cultivation, spinning, weaving to processing, dyeing, printing and finishing. In fact, the Indian garment exporters encountered a sudden problem recently, when faced with a proposed ban by German importers on clothing treated with azo-dyes. Azo-dyes were perceived as cancer causing by German consumers and hence the proposed ban. Indian exporters had not only to ensure that future garment exports to that market were free of such dyes but Indian dye manufacturers are now being obliged td phase out manufacture of azo-dyes and develop suitable substitutes.

Tea & Coffee : To deal effectively with pests, fungus and weeds which cumulatively can create a crop loss of over 30%, there is complete reliance by the Indian tea industry on various pesticides, fungicides and weedicides. Since tea is an edible item, Western countries do not permit pesticide residues in the item beyond a particular 1evel.While the WHOIFAO Codex Alimentarius which determines international food standards, has set safe limits in this context, the Environment Protection Agency of the USA has reportedly adopted, a different specification and Germany has apparently even more stringent requirements. Exporters of items like tea & coffee therefore need to doubIy cautious.

Shrimp & shrimp products : Indian exporters of shrimp fish to America faced a predicament when that country stipulated that it will not import any shrimp, if during the process of netting such fish, the endangered species of sea turtles are in any way harmed. Many Indian exporting units are now being forced to use vehicles fitted with Turtle Excluder Devices (TED) to gain entry in the US market.