general agreement on - world trade organization · 2011-06-08 · the indian delegation has...

GENERAL AGREEMENT ON RESTRICTED

, . . « . . — , * « * i r N - r „ . ^ ^ Spec(82)6/Add.2/SuppL.1 TARIFFS AND TRADE 23 August 1983

Original: English

WORKING PARTY ON STRUCTURAL ADJUSTMENT AND TRADE POLICY

Exchange of Information on the Experience of all Contracting Parties with Regard to

Structural Adjustment

Supplement

Reproduced in the Annex to this document is a supplementary submission by India.

83-1620

Spec(82)6/Add.2/Supp1.1

WORKING PARTY ON STRUCTURAL ADJUSTMENT AND TRADE POLICY

INDIA - SUPPLEMENTARY SUBMISSION

I

"Some preliminary reflections on India's

experience with structural adjustment and trade

policy" were submitted to the Working Party in

February 1982. This was followed by an oral

presentation on 29 March 1983. This supplementary

submission is being* presented with a view to

amplifying some of the indicators of changes of a

structural nature in India's economy.

n

The Indian delegation has consistently

maintained that given the agreed objectives and

nature of the Working Party (annex to L/5120), the

Working Party should identify the relationship

between structural adjustment and trade policy

measures in the context of the objectives of the

GATT, including Part IV and in particular Article

XXXVII 3(b).

2. India has also maintained that in so far

as developing countries are concerned, it appeared

that adjustment was an integral part of the overall

process of the development of the economy as a whole

and as such different from structural adjustment in

the industrialised countries where the focus should

be on resources being allocated in accordance with

the competivity of various sectors of the economy.

As such, for developing countries in general, it

would be inappropriate to look for adjustments

between one sector and another since the accent

Spec(82)6/Add.2/Suppl.1

would have to be on the rapid development of a l l sec tors for which an appropr ia te developmental environment i s required to be c rea ted .

I l l

Without prejudice to our basic contention

that the Working Party should in its deliberations

focus primarily on the process of adjustment, or

the lack of it, in the developed economies, enclosed

are the following tables:

Table - 1 : Selected Economic Indicators

Table - 2 : Agricultural Production

Table - 3 : Production of Selected Industries

Table - 4 : Latest Trends in the Performance of Infrastructure Sectors

Table - 5 : India's Exports by Major Commodity Groups

Table - 6 : India's Imports by Major Commodity Groups

Table - 7 : Direction of Trade

The above are also indexed in pictographic

form.

2. Perusal of the above economic indicators would

indicate the significant changes that have taken place

in all sectors of the Indian economy — industry,

agriculture, infrastructural development and inter

national trade. Descriptive details were provided at

the time of the oral presentation. These significant

changes are the result of the process of development

ushered through an era of planned development which

aims at securing growth with social justice.

3. India's Gross National Product has increased,

except in 1979-80, at a steady pace reaching a rate

of growth of 9.67. in 1975-76 and 5.2% in 1981-82.

Spec(82)6/Add.2/Supp1.1 Fage 4

Production levels in agriculture and industry have

also increased attendant with this overall growth.

The highlight of this has been the very perceptible

modernisation in the sectors of industry and

agriculture resulting partly from the induction of

appropriate modern technology.

4. This regime of sustained growth in all

sectors has been realised with relative stability on

the prices front. Between 1971 to 1982 the share of

various sectors to the National Product has changed

with the share of agriculture and primary activity

declining from 49.5% to 41.8%: manufactures

increasing from 20.1% to 21.2% and certain infra-

structural activity, including, inter alia, transport,

communication, banking, insurance, real estate and

business services, from 21.3% to 24.1%. Within these

structural changes there have been significant

developments and internal changes.

5. Perusal of the attached data on India's

international trade will show that India has a trade

deficit with nearly all the industrialised countries

of the world individually and collectively. Despite

this adverse trade balance, India has been undertaking

a very significant degree of autonomous liberalisation

in its import regime. This cannot be maintained unless

the visible protectionism in the markets of the

developed countries against exports of developing

countries, such as India, is eased.

6. Whilst tariff barriers in the developed

countries have certainly come down as a result of

successful rounds of trade negotiations in the GATT,

the use of non-tariff barriers continues and some new

forms have arisen. Primary amongst these are the

use of ostensible legal instruments such as counter

vailing and anti-dumping duties which are applied in

Spec(82)6/Add.2/SuppL.1

a discriminatory and protective manner against the

legitimate export interests of developing countries.

It has been the experience of developing countries

that the very commencement of an investigation

invariably has had a trade disruptive effect. Apart

from the fact that experience has shown that

investigations in anti-dumping and countervailing

duty cases are launched at the slightest excuse and

without even an attempt to substantiate the allegations

by complainants in importing countries, such investi

gations are then terminated after very long and

cumbersome procedures when a verdict of no injury or

no dumping/subsidy is registered. Meanwhile, the

small exporting firms in the developing country would

invariably have gone out of business. There have also

been innumerable instances of other ostensibly legal

instruments or rules being used against the legitimate

trading interests of developing countries in a highly

discriminatory and protectionist manner.

JCV

After the Working Party has considered the

various national submissions, it would be useful to

make an assessment of the extent of adjustment that

has taken place in the developed economies, the nature

and extent of positive adjustment measures taken by

the governments in those economies and then to assess

the extent to which the adjustment process has

contributed to the liberalisation of trade. If the

Working Party can identify the key sectors where the

impact of structural adjustment has been felt or was

likely to be felt in the near future — sectors where,

for instance, there was clear evidence of rigidities

and protective measures had been repeatedly taken and


intensified, clear possibilities could emerge of

sectors where the developed countries had lost

comparative advantage and where both the importing

and exporting countries could fruitfully consider

transfering production lines in a gradual and

phased out manner to those countries which clearly

enjoyed the comparative advantage or where the

possibility of long range dynamic comparative

advantage clearly existed. Developed countries might,

of course, also like to consider those sectors where

there had been a high growth rate of imports which

threatened the equilibrium. In addition, other

relevant questions related to the inherent flexibility

in these economies to identify and overcome the

rigidities including problems relating to mobility of

labour, fiscal and monetary policies, intended to

assess how these had been used as instruments of

government policy to tackle these rigidities.

2. We firmly believe that it is the task of the

Working Party to attempt an overall assessment along

the lines indicated above and in keeping with its

original terms of reference. An attempt to provide

statistical data either to justify increasing

protectionism by developed countries and problem

sectors or to seek reciprocity from developing

countries would only serve to undermine the philosophy

and work of this exercise in the GATT.

TABLE - I

Selected Economic Indicators

1974-75 1975-76 1976-77 1977-78 1978-79 1979-80 1980-81 (Percentage change over previous year)

1981-82 1982-83

8 10

Gross National Product at 1970-71 prices

Agricultural production

Foodgrains production

Industrial production

Electricity generated*

Wholesale prices (on point to point basis)

Monetary resources (M3)

Imports (at current prices)

Exports (at current prices)

Foreign exchange assets (excluding gold and SDRs)

1.2

-3 .2

-4 .6

3.2

5.2

10.1 10.9

52.9

31.9

9.6

15.2

21.2 7.2

12.9

-6 .5

15.0

16.5 21.4

0.8

- 7 . 0

- 8 . 1 9 .6

11.5

12.0 23.6

-3 .6 27.2

8.9 14.5

13.7 3.2

3.4

0 . 3

18.4

18.7 5.2

5.7

3 .4

4 . 3

7.6

12.2

4 . 6

21.9 13.2

5.9

-4 .8 -15.5

-17 .1 -1 .4

2 . 1

21.4

17.7 32.4

12.8

8.0 15.3

18.1 5.6

5.9

16.7

17.6

38.8

3.9

5.2

5 .5

2 .7

8 .6

10.1

2 .4

12.3

8.9

16.2

5.2 144.3 91.9 57.2 16.0 -1.1 -6.6 -30.4

1

2

3*

4* <

5

6*

i 8

Quick estimates.

Anticipated.

April-November 1982 over the same period in 1981

April-December 1982 over the same period in 1981

March 28, 1982 - January 15, 1983.

As on January 14, 1983 over March 3 1 , 1982.

Provis ional f igures for April-October 1982 over the same period in 1981.

As on January 31 , 1983 compared with January 31 , 1982. E l e c t r i c i t y generat ion r e f e r s to u t i l i t i e s only.

2.0 '

- 3 . 0 '

- 4 . 0 ;

4.0-

7.2<

2.8-

14.2 l

16.l"

17.8

4.3 8

m to to o ->JCO

TABLE - 2

Agricultural Production

(Million tonnes/bales*)

TJ CO ai v>

IQ <T> (D o 00 00

f \ )

O

3> Q. CL

CO C

Crop T>

1972-73 1973-74 1974-75 1975-76 1976-77 1977-78 1978-79 1979-80 1980-81 1 9 8 1 - 8 2 -

8 9 10 11

Foodgrains

0ilseeds(5 major)

Sugarcane(gur)

Cotton (Lint)*

Jute & Mesta*

Potato

97.03

6.86

12.76

5.74

6.09

4.45

104.67

8.85

14.43

6.31

7.68

4.86

99.83

8.53

14.72

7.16

5.83

6.23

121.03

9.91

14.41

5.95

5.91

7.31

111.17

7.83

15.85

5.84

7.10

7.17

126.41

9.00

17.96

7.24

7.15

8.14

131.90

9.35

15.73

7.96

8.33

10.13

109.70

7.86

13.09

7.65

7.96

8.33

129.59

8.08

15.77

7.01

8.16

9.67

133.06

10.90

18.73

7.83

8.40

9.94(P

*170 kgs. each for cotton and 180 kgs. each for jute and mesta.

^ ">

TABLE - 3

tToduction of Selected Industr iel

SI. No.

Industry Unit 1970/71 1981/82

I. MINING

1. Coal

2. Petroleum

II. METALLURGICAL INDUSTRIES

3. Finished Steel

4. Aluminium

III. MECHANICAL ENGG. INDUSTRIES

5. Machine Tools

6. Cotton Textile Machinery

7. Railway Wagons

IV. ELECTRICAL ENGG. INDUSTRIES 8* Power Transformers

9. Radio Receivers

V. CHEMICAL INDUSTRIES

10. Nitrogenous Fertilizer

11. Phosphatic Fertilizer

VI. TEXTILE INDUSSTY 12. Jute Textiles 13. Cotton Cloth 14. Man-made fibres

VII. FOOD INDUSTRY 15. Sugar 16. Tea 17• Coffee

VIII. ETECTRICTTv OFNERATION

Mn. Mn.

Mn.

000

Mn. it

000

Mn.

000

000

000

000 Mn.

Mn.

000 Mn. 000

Tonnes Tonnes

Tonnes

Tonnes

Rs.

Nos.

K.v.a.

Nos.

Tonnes

Tonnes

Tonnes Metres

Metres

Tonnes Kgs. Tonnes

Rn Kwh

76.30

6.80

4.81

166.80

430 303

11.1

8.09

1794

830

229

1060 7602

951

3740 423 71.4

55.8

130.80

16.20

7.27

206.80

2499 3111

17.9

21.44

1739

3144

949

1334. 7983

1463

8434 556

136.4

122.0

SpecC

Page

O 00

o-> Q. Q. f\J

in

r—

TABLE - 4

Latest Trends In the Performance of Infrastructure Sectors

"O CO

<Q (D fl» rt - * 00 o ro

Item

A p r i l - D e c * Pe rcen tage change o 3> Q. Q.

Unit 1979-80 1980-81 1981-82* 1981-82 1982-83 1980-81 1981-82 1982-83 ^

1979-80 1980-tii. CO

c 1981-82 E ( A p r i l - r December) ""*

8 10

1. Coal Production . Mn. Tonnes 103.9 114.0 124.9 87.2 90.9 + 9.7 + 9.6 + 4.2

2. Electricity Generated**

(i) Hydel .

(ii) Thermal (incl. Nuclear)

Bn. Kwh

Bn. Kwh

Bn. Kwh

104.6

4 5 . 5

5 9 . 1

110.8

4 6 . 5

64 .3

122.0

4 9 . 6

72 .4

91 .9

38 .0

53 .9

98 .5

38 .3

60 .2

+ 5.9

+ 2 .2

+ 8.8

+ 1 0 . 1

+ 6.7

+12.6

+ 7.2

+ 0.8

+11.7

3. Railways

(i) Revenue Earning Tonnes Originating Millions 193.1 195.9 221.2

(ii) Average Daily Coal Loading on Railways (in terms of

- 4 wheelers) Wagons/day 8832 8987 10207

160.7 166.4

9908 10742

+ 1.5

+ 1.8

+12.9

+13.6

+ 3.5

+ 8.4

4. Cargo Handled at Million Major Ports Tonnes

78.49 81 .32 8 7 . 4 1

* Provisional ** Utilities only

62.29 70.06

"

+ 3.6 + 7.5 +12.5

r si. No.

1 .

2 .

3 .

4 .

5 .

6 .

7 .

A.

*

S I .

1 .

2 .

3 .

4 .

Commodity

J u t e Manufactures

Tea

Cot ton F a b r i c s

Lea ther & Lea the r Manufac t u r e s

Eng inee r ing Goods

Chemicals & A l l i e d p r o d u c t s

Cot ton Apparel

H a n d i c r a f t s ( i n c l u d i n g p e a r l s , p r e c i o u s and semip r e c i o u s s t o n e s )

PROVISIONAL

Ho. Commodity

Food & Live an ima l s c h i e f l y for food

Raw m a t e r i a l s & I n t e r m e d i a t e Manufactures

C a p i t a l Goods

Others

T o t a l Impor t s

* PROVISIONAL

• i i w m — — 9 —

I n d i c é s Expor t s By Ma.lor Commodity ^ o u p s

Uni t

000 tonnes

M i l l . Kgs.

Mn. Sq. Mts .

Value

Value

Value

Value

Value

TABLE

1970-71 Qty Value

561 1904

199 1483

443 753

722

1304

294

86

699

- 6

I n d i a ' s Impor t s By Ma.lor Commodity Groups

1970-71

2424

8880

4040

998

16342

** Revised t o Rs.136382 fo r supplementary

1975-76

13954

27636

9677

1385

52652

1976-77 1977-78 1978-79

9374 2145 2361

29032 43947 48737

10794 11 '*84 13061

1538 2626 3984

50738 60202 68143

d a t a r e c e i v e d u p t o Oc t . 1982

(Rs

Qty

410

210

390

(Rs

1979-80

2799

69761

14585

4281

91426

. M i l l i o n )

1 9 8 1 - 8 2 '

• M i l l i o n )

1980-81

3802

97565

19103

4769

125239 ]

Value

2501

3733

2725

3741

8173

3473

5479

10338

1981-82"

NA

NA

17458

NA

L35887

"D CO

0) x>

-» 00

>

** ? ru CO •o •o

TABLE - 7

Direct ion of Trade

1.

2 .

3 .

5 .

6 .

U.S.A.

Canada

EEC

OPEC

East Europe

2073.4

279.6

2796.1

1030.0 3624.3

(Rupees in M i l l i o n ) *

S I . No.

1.

Countries

2

EXPORTS

3

1970-71 IMPORTS

4

EXPORTS

5

1981-82 IMPORTS

6

4529.5

1172.3

3186.7 1258.5 2276.5

8815.9

648.7

15304.6 9270.2

17829.1

14213.4

2938.2

30198.5 38826.2 15248.5

•o co

01 X3

n o - X »

Q. a. — CO c T3

* PROVISIONAL

~- - >


SELECTED ECONOMIC INDICATORS

MOCr INOUS TRIAL PRODUCTION CCWJOC)

IOO-IOO

I55

• • • i -«a

>—f' > > > ' ' • ' • '

R s . M i l l i o r

70000C

6 5 0 0 C K ^ -

600000--

550OO0t

ACCREGATE MONETARY RESOURCES LAJT MI04T

- i — i — i 1 — T — i — r 1—I—r

l ,Sf: , ,«-»"*

.'' i i i i i i i i i

7100

6100

5100 ~

4100

EXPORTS

À ' ' ' ' >t 1 \ 1 \ 1 \

• 1 1 1 1

1 ! 1 1

\ A » # »

V ^

i

i

i

\ " i

V 1 1 i

WHOLESALE PRICES

i 1—r

J I I I ' ' J L J L

M e r * • o t .

2 9 5

2 6 5

2 7 5

2 0 5

Rs. SCHEDULED COMMERCIAL B A N K CREDIT

LAST miOAT — i — i — i — i — i — i — i — i — i — i — r ~

• - * - » • < -

J I I I I ' ' ' I L

Million 340000

310000

2800CO

250000

IMPORTS

l—r

M M M

13500

11500

• jTUT or f i M N C i I C O H O M C o ivmon.


PRODUCTION OF SELECTED INDUSTRIES - 7 _ MltLION I I TONMIS

2 0

«76-77 -78 -79 -BO -SI -62 -63

- 2

1976-77 -78 -7» -60 -61 -62 - 6 3 . 1678-77-7» -7».* -00 -d l - 6 2 -63 T —

HMSmT or f W«MC( ICOMOM< OWIttOM.


520

480

440

400

360

320

NET NATIONAL PRODUCT (AT ««70-7» PRICES)

NATIONAL INCOME ny m «000 M i l l i o n

»• ~"*̂ i ______

! ! I PER CAPITA INCOME

760

720

680

RUPEES

600

520

480

440

400

360

320

I97I-72 "73 -74 -75 -76 -77 -78 -79 -80 -81 -82

__ x 1 Tr

760

720

680

640

600 1971-72 - . '3 -74 -75 -76 -77 -78 -79 - 8 0 -81 -82

»•» at >—-»«:( , tco-o-.c » . i m

Spec(82)6/Add.2/Supp L.1

140

120

FOREIGN TRADE «a. N '000 M i l l i o n

- IMPORTS

CX?ORTS

140

120

100

80

60

40

20

1975-76 -77 -78 -79 -00 62-ao e:-ez

FOREIGN

6o r

EXCHANGE RESERVES PS IN '000 M i l l i o n

J ' i - 7 9 -77 -7» -73 - 6 0 -fll - 6 2

I9e2 -e3

m l K l c» " " A K I , CCO

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