India vows to fight liberal import of used goods.

NEW DELHI: India has opposed suggestion by some developed countries for more liberal trade in remanufactured goods or refurbished old products fearing it could harm the country’s domestic industry and also have environmental ramifications.

In a submission to the World Trade Organisation, or WTO, India has said that it was not ready to take on commitments to lower trade barriers in second-hand goods though it will participate in the discussions on understanding and defining of remanufactured goods, a stand endorsed by Argentina, Brazil, Equador and Venezuela.

“We have said that we do not want to be pushed into any kind of agreement for opening up remanufactured goods,” a commerce department official said, adding that the US, Switzerland and Japan were seriously rooting for it.

Discussions on remanufactured goods are taking place as part of the global trade negotiations at the WTO. The so-called Doha round for opening up trade in goods and services is expected to result in gains worth an estimated $282 billion.

Incidentally, India does not have clear-cut guidelines on remanufactured goods. It allows imports against licences for select items such as capital goods but others like second hand automobiles are strictly prohibited.

The industry agrees with the government stand on the issue. “Unrestricted imports of remanufactured goods would adversely impact our domestic manufacturing sector and also have the risk of diluted safety standards and dumping of e-waste,” said Ficci secretary-general Amit Mitra pointing out that India needed to be careful as there was no clarity on what was a remanufactured good.

Global trade in remanufactured products has already crossed $100 billion, according to some estimates, with a large number of companies like GE, Xerox and Caterpillar engaged in it.

Countries promoting trade in remanufactured goods argue that it helps both developed and developing countries by increasing access to low-cost, superior quality products while helping solid waste management and encouraging transfer of technology and skills.

But India is apprehensive that it could lead to a deluge of import of low-quality cheap goods and actually amount to transfer of waste from developed to developing countries.

According to a recent study by Centre for Science and Environment (CSE), illegal import of e-waste in the country stands at about 50,000 tonnes annually, facilitated by legal loopholes like provisions that allow of donation of computers to educational and charitable institutions and hospitals.

India itself generated 330,000 tonnes of e-waste in 2007 – equal to 110 million laptops, the study adds. The amount of e-waste could just go out of hand if import of remanufactured goods is made free, the ministry official added.

Moreover, it could serve a serious blow to the domestic industry such as the automobiles and the IT sectors as refurbished goods could be several times cheaper than the original products. “We could end up killing our own industry if we allow unregulated imports of remanufactured products,” the official said.

Source : economictimes.indiatimes.com