Bangkok agreement gives in to Asia-Pacific Trade Agreement – 30 year old notification superseded.
The Bangkok agreement – background:
In 1963 the United Nations Economic Commission for Asia and the Far East (ECAFE) convened the 1st Meeting of the Council of Ministers on Asian Economic Cooperation. The aim of the meeting was to allow countries to present their views to the ECAFE secretariat on ways and means to promote regional cooperation. Subsequently, the 4th Meeting of the Council of Ministers on Economic Cooperation held in December 1970 adopted a resolution now known as the Kabul Declaration, which called upon ECAFE (now ESCAP, - United Nations Economic and Social Commission for Asia and the Pacific) to develop measures for intra-regional trade expansion and other measures for economic cooperation.
ESCAP's International Trade Division began to identify possibilities for trade liberalization schemes in the region. An Intergovernmental Committee on Trade Expansion Programme met in 1971 and recommended the establishment of a Trade Negotiations Group (TNG), which in turn convened for the first time in February 1972, with the assistance of the United Nations Conference on Trade and Development (UNCTAD). At the 2nd TNG Session, ground rules for the TNG were adopted. In August 1973 thirteen countries attended the 3rd TNG Session which considered tariff reduction among participating States. Lists of requests submitted by participating states were examined in three TNG meetings held in 1974. In July 1975 seven countries, namely, Bangladesh, India, Lao People’s Democratic Republic, the Republic of Korea, Sri Lanka, the Philippines and Thailand, met at Bangkok and agreed to a list of products for mutual tariff reduction. This resulted in the signing the First Agreement on Trade Negotiations among Developing Member Countries of ESCAP, known as the Bangkok Agreement. The Agreement was ratified by five of the seven countries, excluding the Philippines and Thailand.
Objectives
The objectives of the Bangkok Agreement, are to promote economic development through a continuous process of trade expansion among the developing member countries of ESCAP and to further international economic cooperation through the adoption of mutually beneficial trade liberalization measures consistent with their respective present and future development and trade needs, and taking into account the trading interests of third countries, particularly those of other developing countries.
In order to achieve these objectives, the participating states agreed to establish a trade expansion programme among their respective countries on a multilateral basis within the framework of the Bangkok Agreement.
The Bangkok Agreement is essentially a preferential trading arrangement designed to liberalize and expand trade progressively in the ESCAP region through such measures as the relaxation of tariff and non-tariff barriers and trade-related economic cooperation. The Agreement is not designed to divert or restrict trade from countries but to expand mutual trade through fuller exploitation of their trade potential, expansion of productive capacities and higher economic growth. The GATT Council approved the Bangkok Agreement in March 1978, "provided that any preferential treatment under the Agreement shall be designed to facilitate trade between the participating states and not to raise barriers to trade of other contracting parties". Its rules and regulations are meant, inter alia, to ensure non-discriminatory and fair trade practices and to preserve the value of the preferences including compensatory action where the value of the preference is reduced or abrogated. It also aims at cooperation in matters such as customs administration, standardization of procedures and formalities relating to mutual trade, adoption of a common tariff nomenclature and harmonization of rules of origin and of dumping.
Membership
The five original members of the Bangkok Agreement are Bangladesh, India, the Republic of Korea, Lao People's Democratic Republic and Sri Lanka. Lao PDR has not issued customs notification on the tariff concessions granted, and in this respect is not an effective participating member. Some other members have however extended their concessions to include Lao PDR.
In an important event, China formally became a member of the Bangkok Agreement in 2001. China's accession has major implications for the Bangkok Agreement and for trade in the Asia-Pacific region.
The Bangkok agreement became the Asia-Pacific Trade Agreement and the first Session of the Ministerial Council was held in Beijing, China. The council declared,
We note that the international trading system has changed considerably since the Agreement was signed in 1975, and recognize that the establishment of a rules-based multilateral trading system embodied in the World Trade Organization will benefit all countries actively participating in the system. While fully embracing the ideals of global trade liberalization, we also have a vision of region-wide cooperation on trade, investment and related issues, and, aware of the potential of the Asia-Pacific Trade Agreement in this respect, invite other countries in the region to join this unique forum, whose coverage we would like to see gradually expanding to include trade facilitation issues and trade in services.
The second session of the council is to be hosted by India in 2007.
This agreement was to be in place by the 1st of July 2006. Now the Government of India has issued two notifications to notify the rules of origin and allow exemption.
Notification No. supersedes Notification No. 430/1976-Customs dated 1st November 1976 and notifies the new rules of origin.
Notification No. amends Notification No. to include the APTA and the rates of duty. While this notification amends Notification No. , the note appended to the notification states
Note. - The principal notification No. 85/2004-Customs, dated the 31st August, 2004, was published in the Gazette of India, Extraordinary, vide number G.S.R. 560 (E), dated the 31st August, 2004 and was last amended by notification No. 69/2006-Customs, dated the 30 thJune,2006, published vide number G.S.R. 395 (E) dated the 30 thJune,2006.
How is Notification No. relevant?
NOTIFICATION NO. , Dated: August 31, 2006 and NOTIFICATION No. ,Dated: September 1, 2006