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What is the News?
Union Cabinet has approved a Comprehensive Economic Cooperation and Partnership Agreement(CECPA) with Mauritius.
What is CECPA?
- It is a kind of free trade pact that aims to provide an institutional mechanism to encourage and improve trade between the two countries.
- Under this agreement, countries cut or eliminate the duties on the products. The countries also liberalize the norms to promote the services trade.
Key Features of India – Mauritius CECPA
- It is a limited agreement that will cover only select sectors. The agreement covers Trade in Goods, Rules of Origin, Trade in Services, Technical Barriers to Trade(TBT). Further, the agreement also covers Sanitary and Phytosanitary(SPS) measures, Dispute Settlement, Movement of Natural Persons, Telecom, Customs Procedures and Cooperation.
- The two countries have also agreed to negotiate an Automatic Trigger Safeguard Mechanism(ATSM). They will negotiate on ATSM for a limited number of highly sensitive products within two years of the Signing of the Agreement.
What is Automatic Trigger Safeguard Mechanism(ATSM)?
It is a special safeguards mechanism included in the agreement. This will protect the country from any sudden or dramatic increase in imports. Under this mechanism, If the imports of a product are rising alarmingly, then after reaching a certain threshold, India can impose safeguard duties on imports from Mauritius automatically. The same provision applies to Mauritius as well against Indian imports.
Timeline:
- The Agreement will be signed by both the countries on a mutually convenient date and will come into force from the 1st date of the following month.
- Once signed, this will be the first such trade agreement between India and an African nation.
India-Mauritius Economic Relations:
Mauritius is an important development partner of India.
- India had extended a ‘Special Economic Package’ of USD 353 million to Mauritius in 2016. The new Mauritius Supreme Court building project is one of the projects implemented under this package. This was jointly inaugurated by both the countries in 2020.
- According to the International Trade Centre(ITC), in 2019, the main import partners of Mauritius were India (13.85%), China (16.69%), South Africa (8.07%), and UAE (7.28%).
- The bilateral trade between India and Mauritius has registered a growth of 233% from USD 206.76 million in the Financial Year(FY) 2005-06 to USD 690.02 million in FY 2019-20.
Source: The Hindu
