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Recent Developments in Customs Tariff Policy in India: Implications for Indian Agriculture

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  • Deepika M G

Abstract

The paper reviews the developments and recent reforms in the customs tariff policy in India with the recommendations of the Working Group on Tariffs (2001) and Kelkar Report (2002) and analyzes the implications of levying a low uniform tariff for Indian agriculture. In India, tariffs in agriculture played an insignificant role in the era of quantitative restrictions. The need for a proper tariff policy was largely felt with the removal of quantitative restrictions in the late 1990s. The Inter-ministerial Group on Customs Tariffs was strongly in favor of imposing a low uniform tariff across all the commodities for the reason that it is efficient, equitable and administratively convenient. There is a concern that Indian agriculture, which has been subject to tariffication with the removal of quantitative restrictions, would be affected by such a move. An analysis of the protection to Indian agricultural commodities, however, shows that not many commodities would be affected; rather agriculture in total would gain because of better terms of trade resulting from reduced protection to manufacturing.

Suggested Citation

  • Deepika M G, 2007. "Recent Developments in Customs Tariff Policy in India: Implications for Indian Agriculture," The IUP Journal of Agricultural Economics, IUP Publications, vol. 0(4), pages 47-61, October.
  • Handle: RePEc:icf:icfjag:v:04:y:2007:i:4:p:47-61
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