NEWS – Starting from January 1, 2024, Indian exporters are required to follow the new rules under DCTS to avail of concessions on their exports to the UK

HIGHLIGHTS OF DCTS

• This new scheme aims to provide duty concessions to exporters from developing countries, including India, in order to facilitate trade with the UK.

Transition Period and Implementation of New Rules:

• The transition period for the switch to DCTS was extended until December 31, 2023.
• Starting from January 1, 2024, Indian exporters are required to follow the new rules under DCTS to avail of concessions on their exports to the UK.

Rules of Origin (RoO) Requirements and Self-Certification:

• Goods that meet the UK DCTS RoO requirements will be eligible for a concessional rate of import duty when exported to the UK.
• Exporters must adhere to the RoO requirements through self-certification to claim tariff concessions.

Changes in Origin Declaration Wording:

• Indian exporters are instructed to use origin declaration wording specific to the DCTS scheme, replacing the previous GSP origin declaration wording.

Beneficiaries and Impact on Labour-Intensive Sectors:

• Certain labour-intensive sectors such as leather, carpets, chemicals, iron and steel, and textiles were major beneficiaries of the GSP scheme.
• The DCTS aims to continue providing benefits to developing countries like India, albeit with some changes in eligibility criteria and tariff rates.

Negotiations for Free Trade Agreement (FTA) between India and the UK:

• India and the UK have been engaged in negotiations for an FTA since January 13, 2021, with 14 rounds of talks completed so far.
• Both sides are working towards concluding the negotiations promptly to further enhance trade relations.

Key Features and Limitations of DCTS:

• DCTS benefits 65 developing and least developed countries, offering reduced tariffs on exports to the UK.
• However, products exceeding a certain limit in exports to the UK may not qualify for lower tariffs under DCTS, affecting some Indian exports like textiles.

Economic Implications and Export Statistics:

• Indian exports worth USD 2.5 billion were entitled to GSP benefits in the UK, highlighting the significant impact of these trade schemes on export revenues.
• The new DCTS rules and limits have resulted in changes in tariff rates for specific Indian products, affecting their competitiveness in the UK market