Streamlining India’s Customs: GTRI Calls for Overhaul

The Global Trade Research Initiative (GTRI) urges India to simplify its complex customs duty structure by cutting the number of duty slabs, rather than just adjusting basic customs duty rates, to facilitate ease of doing business. GTRI emphasizes comprehensive reforms to ensure competitiveness in trade and manufacturing.

The Global Trade Research Initiative (GTRI) has called for India to streamline its customs duty structure, emphasizing the need for fewer duty slabs rather than adjustments to basic customs duty (BCD) rates. This recommendation aims to enhance the ease of doing business across the nation.

Despite previous measures to decrease ad valorem BCD rates, the existing system still includes a multitude of specific duties, mixed duties, and conditional rates. This complexity undermines the stated objective of simplification, GTRI noted in their pre-Budget suggestions. Additionally, the shifting of some BCD to the Agriculture Infrastructure and Development Cess (AIDC) further complicates the current structure.

GTRI founder Ajay Srivastava highlighted the economic implications of the outdated tariff system, pointing out inefficiencies that could impede India's goals of manufacturing growth and export diversification amid global trade challenges. A comprehensive reform, including transparent duty slabs and a user-friendly customs process, is urgently needed.