Vietnam ships about 10,000 – 12,000 tonnes of incense sticks worth 7 million USD to India each month, according to the Ministry of Industry and Trade (Photo: WTO and Integration Centre) Hanoi (VNA) – Businesses and Stateagencies met in Hanoi on September 16 to discuss measures in response toIndia’s recent restriction of incense stick imports, which is considered aserious trade barrier.
Tran Thanh Hai, Director of the Export-ImportDepartment of the Ministry of Industry and Trade (MoIT), said the IndianMinistry of Commerce and Industry issued a notification on August 31 changingthe incense import policy from free to restricted, requiring importers to askfor licenses for each batch of goods from an inter-ministry committee. Thepolicy became effective right on the date of approval, with no license grantingcriteria enclosed.
As India is an irreplaceable market for incensesticks and similar products, this restriction has immediately caused stagnationin all production and trading of incense destined for India.
Nguyen Thi Thu Trang, Director of the WTO andIntegration Centre of the Vietnam Chamber of Commerce and Industry (VCCI), saidthere are many signs indicating the restriction violates India’s commitments ininternational agreements.
There are about 100 businesses in the Vietnameseincense industry with about 25,000 workers, most of whom are from vulnerablegroups like elderly or disabled people in rural areas. Therefore, supportingthe industry is needed to not only “save” businesses but also assist theworkers, she stressed.
Chairman of Truong Giang, an incense exportingfirm, Vo Xuan Hoi proposed the Government ask India to suspend the restrictionimposition to give Vietnamese firms time to re-arrange their goods andemployees. The immediate enforcement of such a policy is unprecedented in theworld, except for in the case of epidemics.
He called on the Indian government tore-consider the decision, adding that such regulatory barriers will greatlyaffect both Indian and Vietnamese businesses.
Trang said it will difficult to ask the Indian governmentto cancel a regulatory document, but the two countries’ governments shouldconvene a working session soon to postpone the enforcement of the restrictionand discuss the legality of the move.
According to Hai, erecting import barriers onsome commodities is not a new issue, but the Indian policy has been appliedimmediately without any time for businesses to adapt or prepare.
India was unable to give any appropriate reasonsfor the restriction, he noted.
The official said in the current context,enterprises should connect with one another to share information and have acommon voice to improve their associations’ operations. They also need to stayready to deal with other countries’ trade barriers while promoting theircompetitiveness and diversifying markets.
He also suggested Vietnamese firms work withIndian importers, who have also been harmed, to demand their legitimateinterests be protected. Meanwhile, the MoIT will work with the Ministry ofForeign Affairs to take more drastic actions.
Data of the MoIT shows that Vietnam ships about10,000 – 12,000 tonnes of incense sticks worth 7 million USD to India eachmonth.
India imported about 83.58 million USD worth ofincense and similar products in the 2018-2019 fiscal year. It imports bothfinished products and materials from many countries, mainly Vietnam and China.The Vietnamese products make up 90 percent of India’s incense import revenue,according to the Indian Ministry of Commerce and Industry.
The import policy change by India is reportedlyto defend its incense production industry, which is worth about 900 millionUSD, in the face of a surge in incense imports in recent years./.
VNA
