India to raise its concerns over Argentina’s import restrictions bilaterally.

NEW DELHI: India has decided to raise its concerns over Argentina's recent import restrictions bilaterally, instead of joining the US and European Union who have taken the country to the World Trade Organization.

The government has asked the Indian embassy in Buenos Aires to arrange a meeting soon with Argentine authorities. This follows discussions between senior commerce department officials and Argentina's ambassador in Delhi.

"The import restrictions, imposed in the form of import licenses and extensive paper work, is so onerous that it has become almost impossible for exporters to send their shipments to the country," a commerce department official told ET. "We cannot leave it on Argentina to settle the problem but have to step in and handle the matter urgently."

The official, however, said India has refused to be part of a group of nations that strongly criticised Argentina's import restrictions at the WTO last month. The group, which includes the US, the EU, Japan and 10 other countries, has accused Argentina of tying up its imports in red tape.

"We did not want to embarrass the country by joining hands with main players of the developed world. But that does not mean that we are going to let the matter rest as it has huge implications for future exports," the official said.

Argentina applied the import restrictions in February in response to a sharp dip in its exportable surplus last year.

The country is an important destination for Indian exporters who are looking at ways to diversify beyond the traditional markets of the EU and the US, especially in the backdrop of the uncertainty gripping the developed world. The government, too, is helping in the initiative by giving incentives under the 'focus market and focus product' schemes.

India's merchandise exports to Argentina were $400 million (about Rs 2,100 crore at current rates) in 2010-11. Although it was just 0.16% of the country's total exports in that year, it posted a jump of 47.5%.

But exporters are apprehensive of a dip in figures now because of the new import norms. They are not able to ship consignments for which orders were placed earlier by Argentine importers, who are not able to obtain import licences under the new rules.

"Exports have been hit badly over the last few months. Importers from the country want to buy from us, but are unable to do so as it has become very difficult to obtain import licences after the restrictions were imposed," said Rafeeque Ahmed, president, Fieo.

This has come as a rude shock for exporters from a number of sectors such as commodities, handicraft, leather products and light engineering goods who were slowly and steadily establishing a foothold in the market.

"We have discussed it with the government and are hopeful that something would be done soon," Ahmed said.

The government, at present, is not looking at the WTO path at all to sort out the issue, the official quoted earlier said. "We are hopeful that we will get results through our bilateral consultations. If we don't, then we will plan our future course of action," the official said.

Source : economictimes.indiatimes.com