Certificate of origin: India asks trade partners for relief to exporters

The request is part of India’s efforts to assuage pains of its exporters who are already grappling with a plunge in orders and deteriorating cash flow due to the pandemic.

India on Sunday asked nations with which it has forged trade agreements to temporarily allow its exporters to supply goods without certificates of origin, as the Covid-19 outbreak has forced the country to go on an unprecedented lockdown. For its part, New Delhi is also willing to grant similar concessions to these partners upon formal requests. The certificate of origin is an important part of the customs clearance documentation, as concessions granted by partners to one another under a trade agreement are not extended to products from other countries.

The request is part of India’s efforts to assuage pains of its exporters who are already grappling with a plunge in orders and deteriorating cash flow due to the pandemic. India has forged free and preferential trade agreements with dozens of countries. Its major FTAs are with Asean, Singapore, Japan, South Korea, Malaysia and south-Asian countries (SAFTA), covering close to a fourth of its merchandise exports.

In a trade notice, the commerce ministry said the offices of customs and other authorities that issue the certificates of origin are shut and are, therefore, unable to discharge their duties. However, such certificates will be issued later with retrospective effect. Therefore, in the interim period, it wants its FTA/PTA partners to “allow eligible imports under preferences on a retrospective basis, subject to the subsequent production of the certificates of origin by the Indian exporters”.

Exporters have already warned of a crash in outbound shipments in FY21, as global supply chain has been hit hard, cargo movement has been affected, shipping lines altered and warehouse capacity stretched following the Covid-19 outbreak. Up to February this fiscal, overall goods exports contracted by 1.5% year-on-year to $293 billion. Analysts now say goods exports this fiscal may drop to $315 billion or less, against $330 billion in the previous year.