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In order to enhance trade with CIS (Commonwealth of Independent States) region, the government has undertaken many trade facilitation steps and trade promotion measures. These include government Lines of Credit (LOC), Inter-Banking relations, Double Taxation Avoidance Agreement (DTAA), Bilateral Investment Protection Agreement (BIPA) and strengthening of institutional mechanisms like Joint Commission Meetings, Joint Business Councils and Trade Missions/Delegations. Considering the potential that this region offers, the government had launched Focus: CIS Programme in 2003 to enhance India’s trade with this region. The Programme covers all the 12 CIS countries w.e.f. April 2004. India’s exports to the CIS region, including Russia, have grown from US $ 919 million in the year 2002-03 to US $ 1.020 billion in the year 2003-04, registering a growth of 11%.
International North South Transport Corridor Agreement was signed between India, Iran and Russian Federation to facilitate movement of goods via Caspian Sea and Astrakhab to Russia and adjoining countries of the CIS region. The Agreement provides a faster and cheaper transit route for trade to Iran, Russian Federation and beyond, which will make country’s exports competitive.
Under the India Development Initiative, the Ministry of Finance, Department of Economic Affairs has issued new guidelines for Government Lines of Credit (LOC). Recipient countries have been put under four different classifications. In the revised policy guidelines the State Bank of India, Bank of Baroda and Indian Overseas Bank are also being used in addition to EXIM Bank for channelling the LOCs to other governments.
To promote and facilitate trade, DTAA has already been signed with Russian Federation, Ukraine, Kyrgyzstan, Turkmenistan, Kazakhstan, Uzbekistan, Armenia and Belarus. Negotiations are on for signing the same with Azerbaijan. Steps will be taken for initiating negotiations with rest of the CIS countries i.e. Moldova, Georgia and Tajikistan.
The government has signed BIPA with Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, Tajikistan, Russian Federation, Ukraine, Armenia and Belarus. Steps will be taken for signing BIPA with rest of the CIS countries i.e. Azerbaijan, Moldova and Georgia.
The government has allowed exports of Indian goods on consignment basis under the debt repayment route to the Russian Federation. ECGC has upgraded credit ratings of a number of countries in the CIS region as well as liberalised its under writing policy to these countries which will help in promoting exports to this region.
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