Problems to arise if transit fees fixed as per WTO rules
An eminent economist and expert of trade negotiation cautioned about potential hazards of fixing transit fees under the articles of World Trade Organization (WTO) as the approach would be counter-productive.
An eminent economist and expert of trade negotiation cautioned about
potential hazards of fixing transit fees under the articles of World
Trade Organization (WTO) as the approach would be counter-productive.
A
committee of Tariff Commission last week submitted a report to the
government recommending equal transit fees for all countries in line
with WTO rules.
“The transit fees should not be considered under
WTO rules as it would invite more problems than benefit,” eminent
economist Dr Debapriya Bhattacharya told the news agency yesterday.
Referring
to Article 5 of WTO regarding freedom of transit, Bhattacharya, who
represented Bangladesh at WTO, said this article of the UN body is not
related to this issue.
According to the article, transit means
transporting products originated from one place, passing to other
country and terminating at another country, he said.
He, however,
said there is a “creative ambiguity” in this article, as it does not
clearly say that there should be a third country. The ambiguity gives
the flexibility to interpret the article, considering different aspects
at different places.
“So there can be two definitions of the
article -- inclusive and exclusive. The exclusive definition is country
A to country B to country C and inclusive definition is country A to
country B to country A again. If we go to WTO, they will most possibly
consider inclusive definition.”
Citing the trade liberalisation
process, Bhattacharya said if transit is provided to any country under
WTO rules, all countries should be provided with similar facilities as
WTO rules also refer to MFN (most favoured nations) status.
He
said whether transit facility would be provided to all countries should
be considered, otherwise provoking WTO would bring problems.
Bhattacharya,
a senior distinguished fellow of the country's leading think-tank
Centre for Policy Dialogue (CPD), also suggested for bilateral approach
to the issue instead of making a multilateral document for transit fees.
“The
document for fees (for transit) should be bilateral as it is based on
the communique, between India and Bangladesh, signed at a meeting
between Prime Minister Sheikh Hasina and Indian premier Manmohan Singh
in New Delhi last year.”
He advised for comprehensive study
before fixing transit fees for using Bangladesh roads and
infrastructure by India. “It will not be wise to fix the fees on the
basis of other's study instead of doing our own homework on it.”
He
said all the issues like congestion charges, cost of lands and its
impact on food production, environment and biodiversity should also be
considered to fix the fees.
