New Delhi: The Indian industry, both exporters and experts included, needs to debate and find ways to deal with stringent private standards in order to access lucrative markets of the world and boost shipments, a top government official said on Friday.
These private standards, mainly meant for sectors such as food, agriculture, textiles and agro-forestry products, are fixed by multi-national companies and are often more stringent than those followed by respective governments, which jacks up the compliance cost for domestic suppliers, particularly MSMEs from developing countries.
Chances are high that the governments may also follow suit and step up their own standards in line with those of MNCs, which may make it difficult for exporters from developing countries like India to access such markets.
"This is imperative for us to look very seriously at a hub, at a place where we can actively debate these issues and find ways forward to support our domestic industry to access markets. Private standards are emerging as significant in the world trade," Commerce Secretary Rita Teaotia said here at an event.
Standards refer to product quality, which are gradually replacing tariffs in international trade as Customs duties on products are in decline.
These standards, she said, do raise a number of issues mostly due to the nature of their ownership and development process and sometimes tend to become barriers for market access.
Teaotia sees it as a challenge for exporters and countries to comply with these standards "if you want to (get to) that market", adding that this requires a lot of money, time and a particular set of skills.
The problem becomes acute in developing countries where "there is an issue of lack of infrastructure, conformity assessment structures and public finance that can support domestic producers who implement these standards".
She was speaking at the launch of a national platform on private sustainability standards. The objective of this platform is to conduct a dialogue on a regular basis on the issue. The event was organised by the Quality Council of India (QCI) and the United Nations Forum on Sustainability Standards.
"We also need to see whether we can develop capacity in our system for development of Indian private standards," Teaotia said.
Her assessment is that the platform should enable Indian industry to cater to the requirements of the world and also address the need for the world to meet the requirements of India and "that is the challenge that we should aspire to".
"What we are seeing over the last couple of decades is private standards which have become a very strong mode of governance in developed countries and that is the reality of trade," the secretary said.
"Most countries will adopt policies that will limit the inflow of goods into their markets, and the objective for this will vary from economic to national and health to security."