Saturday, November 14, 2015

Why India is not willing to sign ITA(Information Technology Agreement) of World Trade Organization

The first Information Technology Agreement was signed in 1997 which reduced imports cost of electronic goods. Those cheap imported electronic goods to some extent made the domestic electronic manufacturing industry unviable. India does not want to repeat the same mistake as this time in the new ITA 200 new tariff categories have been introduced which will cover around $1 trillion in global sales trade. The trade pact has been signed between China and USA.

Why India is reluctant to sign the agreement – 

China and USA are 2 countries which in electronics sector are technically very superior in producing sophisticated devices at a cheaper rate. If the import duty on electronics item imported from these countries is removed their price will be very low in the market when compared to domestically produced electronics goods. So there are chances that domestic manufactures will stop manufacturing as commercially it will become unviable for them. Also the “Make in India” initiative of our PM will suffer a major setback.

India’s stance is that is will sign the pact one’s its domestic manufacturing expertise is improved enough to compete with foreign imported products.

India is facing renewed pressure because of the reason that it is one of the biggest market and consumer of electronic goods all over the World.

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