India has raised concerns on the World Trade Organization (WTO) over a bunch of trade barriers built in by Indonesia, together with export restrictions on palm oil and import curbs on bovine meat and automotive (auto) elements, holding that such measures have adversely impacted India.
“India remains concerned with the Indonesian import substitution programme and export policies. Indonesia is maintaining a number of restrictions on imports, as well as exports, which is affecting Indian businesses — both in terms of exports, as well as supply-chain disruptions. We have raised the matter in the Committee on Market Access and the Council for Trade in Goods at the WTO. However, Indonesia has not provided any clear response in the bilateral talks,” mentioned a authorities official aware of the talks.
Indonesia final week banned the export of crude and refined palm oil amid world scarcity of the edible oil after Russia’s invasion of Ukraine. After Malaysia, Indonesia is the second-largest supply of palm oil for India.
India imported 42 per cent (or 3.4 million tonnes) of its complete palm oil imports from Indonesia in 2021. Before the ban, Indonesia had put in place a excessive export responsibility and an export levy on palm oil, in addition to adopted export-curbing procedures, pushing up the costs of palm oil and edible oils in India.
“India had requested Indonesia to take necessary action by not resorting to increasing the reference price of palm oil,” mentioned the official quoted earlier.
Indonesia has additionally diminished the annual quota on bovine meat import. There are port restrictions on such imports, resulting in a rise in export price. A delay in the issuance of horticultural product import suggestions for agricultural merchandise like onion, potato, and many others has additionally affected India’s exports.
“We have also asked Indonesia to lift restrictions on the export of ginger,” added the official.
India exported bovine meat price $262 million and greens price $30 million in 2021. Indonesia has additionally positioned quantitative restrictions on the import of autos and parts.
“A delay in the issuance of permits for the import of Indian commercial vehicles could adversely affect Indian auto companies. Indonesian policies remain a concern for Indian chemicals and pharmaceutical products,” mentioned the official.
In 2021, India exported autos and elements for $366 million, natural chemical substances for $$536 million, and prescribed drugs for $$119 million to Indonesia. Overall exports to Indonesia in 2021 rose 43.1 per cent to $8.1 billion, whereas imports elevated 39.1 per cent to $16.7 billion throughout the identical interval, resulting in a trade deficit of $8.6 billion.