Environmental goods services india vijaya katti


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Environmental goods services india vijaya katti

  1. 1. Environmental Goods and Services: Issues for Negotiations for India Vijaya Katti November 2005
  2. 2. Table of Contents 1. Introduction …………………………………………………………………… 2. Environmental Goods and Services (EGS): Status of Negotiations on EGS … 2.1 Definitions and Classification of EGS …………………………………… 2.2 General Direction of Negotiations on EGS ………………………………. 2.21 Environmental Goods …………………………………………………… 2.22 Environmental Services ………………………………………………… 3. Overview of India‘s Environmental Goods and Services Industry ………….. 4. Challenges and Opportunities for India ……………………………………… 4.1 Multiple Use and Customs Policy ……………………………………….. 4.2 Reduction v/s elimination of barriers ……………………………………. 4.3 Environmentally Preferable Products (EPPs) ……………………………. 4.4 India‘s Export Potential for Environmental Services ……………………. 4.5 Clean Development Mechanism (CDM) …………………………………. 5. Conclusions and Recommendations …………………………………………. p.1 p.3 p.3 p.8 p.10 p.13 p.18 p.28 p.31 p.32 p.33 p.35 p.37 p.41 List of Tables Table 1 – CPC and GATS Categories of Environmental Services ……………… Table 2 – Composition of Indian Environmental Industry ……………………… Table 3 – Foreign Affiliation in the Indian Environmental Industry ……………. Table 4 – Selected Environmental Joint Ventures ………………………………. p.7 p.19 p.26 p.27 Annexure 1. 1A. 2. 3. 4. 5. 6. 7. 8. Trade Balance of Indian Environmental Goods as per APEC List Share of Export and Import of Indian Environmental Goods as per APEC List Major Destinations for India‘s Imports and Exports of Environmental Goods as per APEC List India‘s Import of Environmental Products and their Growth Arranged in Descending Order Export of Environmental Goods from India Arranged According to their Growth during 1998-2003 Top 20 Exports of Indian Environmental Goods according to Value in 2002 and RCA of those Products 20 Environmental Goods of India (experiencing maximum growth rate during 1998-2003) and their Revealed Comparative Advantage Items which have more than one use (dual use or multiple use) Items which can be of interest for India 2
  3. 3. ENVIRONMENTAL GOODS AND SERVICES: ISSUES FOR NEGOTIATIONS FOR INDIA Abstract Liberalisation of trade in environmental goods and services (EGS) has become a key issue at the complex and rapidly developing trade and environment interface. The World Trade Organisation (WTO) at its fourth Ministerial meeting in Doha in 2001, decided to negotiate opening the market for EGS and set out a commitment to the reduction/elimination of tariff and non-tariff barriers to EGS. This paper aims at examining select issues for negotiations in the area of EGS against the background of the Doha Ministerial Declaration. Different concepts of environmental goods and environmental services, the narrower and the broader definitions, are examined and the OECD and APEC lists are compared and categories of environmental goods are highlighted. The paper provides an overview of India‘s EGS industry and market, the existing tariffs on environmental goods and the importance of these products in India‘s total exports. It identifies environmental goods in which India has comparative advantage and discusses the potential for environmental services. It highlights the issues which can be considered for the negotiating agenda by developing countries in general and India in particular. Key words: Sustainable Development, WTO, Doha development agenda, India, environmental goods and services (EGS), liberalization of trade in EGS, environmental industry and technology transfer 3
  4. 4. ENVIRONMENTAL GOODS AND SERVICES: ISSUES FOR NEGOTIATIONS FOR INDIA 1.0 Introduction Liberalisation of trade in environmental goods and services has become one of the highly debated set of issues, in the complex and rapidly developing trade and environment interface. At its fourth Ministerial meeting, held in Doha in 2001, the World Trade Organisation (WTO) for the first time explicitly made trade and sustainable development an integral part of its trade negotiation agenda. Paragraph 6 of the Doha Ministerial Declaration reaffirming the commitment to the objective of sustainable development, mentions that upholding and safeguarding an open and non-discriminatory multilateral trading system, and acting for the protection of the environment and the promotion of sustainable development can and must be mutually supportive. By paragraph 16 trade ministers have decided to negotiate opening the market for environmental goods and services and by paragraph 31, there is commitment to the reduction / elimination of tariff and non-tariff barriers to Environmental Goods and Services (EGS). In particular it has been agreed to take into consideration developing countries‘ market access concerns and pay attention to products of export interest to developing countries. In order to fulfil the Doha Mandate, it is critical for developing countries to understand the current status of their market for EGS. Since the applied and bound tariffs on environmental goods are low in developed countries and tariffs in developing countries for these goods are similar to those for industrial goods, negotiations may lead to 1
  5. 5. substantial reductions in bound tariffs of developing countries. It is against this background that developing countries need to identify products in which they have a comparative advantage. This is absolutely necessary because there is no definition of EGS yet and their perspectives regarding whether to include all environmentally friendly products in the list of environmental goods differs. It has been generally agreed that the negotiations for environmental goods will take place in the Negotiating Group on Market Access (NGMA) while the negotiations for environmental services will take place in Council for Trade in Services Special Session (CTSSS). The Committee on Trade and Environment Special Session (CTESS) is to work towards clarifying the concept of environmental goods and it is presumed that no sequencing would be involved between that work and the actual market access negotiations in the NGMA. This paper aims to examine select issues for negotiations in the area of environmental goods & services against the background of paragraph 6 and paragraph 16 of Doha Ministerial Declaration. This paper has the following objectives: 1. To examine the current status of the environmental goods and services industry market in India, the existing tariffs for environmental goods and the importance of these products to India‘s total exports 2. To identify environmental goods in which India has comparative advantage; and 2
  6. 6. 3. To highlight issues which should be addressed on the negotiating agenda by developing countries in general and India in particular. The evidence and lessons that emerge from the investigations of this research paper will be of interest to all those countries in the South/Southeast Asia region that are trying to overcome the challenges of effectively integrating sustainable development objectives into their trade negotiations, and are formulating their negotiating position for the next round of WTO negotiations. The paper is divided in four sections: environmental goods and services: state of negotiations in EGS; overview of India‘s environmental goods & services industry; opportunities for India; and conclusions & policy recommendations. 2.0 Environmental Goods and Services: Status of Negotiations on EGS 2.1 Definitions and Classification of EGS There is no single universally accepted definition of environmental goods and services and in the sustainable development debate, different concepts of ―environmental goods‖ and ―environmental services‖ are used. The Doha Declaration does not clearly define what constitutes ‗environmental goods‘. An environmental good is considered any equipment, material or technology used to address a particular environmental problem or as a product that is itself ―environmentally preferable‖ to other similar products because of its relatively benign impact on the environment (Hamwey et al 2003). A narrow definition and also a broader definition of environmental goods exist. According to the narrow definition, environmental goods are those whose use results in a 3
  7. 7. beneficial environmental impact—capital goods or technologies required for ‗end-of-thepipe‘ pollution abatement. The broader definition, on the other hand, takes into account the environmental characteristics of the goods themselves and/or their production processes. This includes the industrial goods used to provide environmental services to address pollution and waste affecting water, soil and air. These goods generally have multiple end-uses, only one of which is to provide environmental services, and usually do not have inherently environmental characteristics. It is their use to provide environmental services that qualifies them as environmental goods and they have relatively less negative impacts on the environment at the production, consumption or disposal stage, or even in terms of being produced in an environmentally benign manner or with ‗clean technology‘. Examples of these types of goods include: pumps, valves, compressors, tanks and containers, chemicals used in water purification, air/water filters, trash compactors, brooms, plastic lining material for landfill sites, ceramic wares and furnaces used in incineration, sorting equipment for recycling, measuring equipment to monitor the environment, noise reducing mufflers, etc. The Organization for Economic Co-operation and Development (OECD) and the Statistical Office of the European Communities (Eurostat) have defined the environmental industry as: ―activities which produce goods and services to measure, prevent, limit, minimize or correct environmental damage to water, air and soil, as well as problems related to waste, noise and ecosystems‖(OECD 2003). This definition provides a basis for an indicative list of EGS that extends across environmental media and 4
  8. 8. classifies them under three broad rubrics: i) pollution management, ii) cleaner technologies and products, and iii) resource management. In yet another approach, some experts have interpreted environmental goods as goods with inherently beneficial environmental aspects such as biodegradability. According to this view, products like organic fertilizers, natural dyes and jute and bamboo products could be brought into the ambit of environmental goods. Two types of definitions and sectoral coverage under the category of Environmental Goods have been quoted extensively in the literature – OECD and Asia Pacific Economic Cooperation (APEC). These lists have formulated the basis for the stands taken by various countries for negotiations. The APEC list largely includes end-of-pipe environmental equipment; measuring and testing instruments; alternative power generating equipment; parts and components of both these categories of products. OECD has developed three categories of Pollution Management Products, Cleaner Technologies and Products and Resource Management Products. The OECD list includes all the categories in APEC list and additionally includes chemicals used in pollution control processes and some other items (Environmental Goods: A comparison of the APEC & OECD lists, OECD-2003) in addition to equipments, chemicals, as well as cleaner technologies, which fit into the wide definition of environmental industry. It also encompasses cleaner processes and resource management. However, there are many items in the list that cannot be captured by the HS (Harmonized System) code system for the purpose of international trade. 5
  9. 9. Counting only entries with corresponding Harmonized System (HS) codes, the OECD list appears to be about 50% longer than the APEC list. However, when one eliminates multiple listings at the 6-digit level, they are more similar in length: there are 132 unique HS codes in the OECD list, compared with 104 in the APEC list. The composite list has 233 entries identified with an HS code, covering 198 different goods. These magnitudes are small compared with the total numbers of lines contained in WTO Members national tariff schedules, which range from less than 6000 (in the schedules of Australia and India) to over 11000 (in the schedules of Hungary, Korea, Mexico, and Turkey). In all, less than 30% of the goods are common to both lists. The greatest areas of overlap are found in the categories of air-pollution control, recycling, incineration, and measuring and monitoring equipment (UNCTAD 2003). An UNCTAD study (July 2005) has set out 2 types of EGS. Type A environmental goods include industrial goods used to provide environmental services to address pollution and waste affecting water, soil and air. These goods generally have multiple end-uses, only one of which is to provide environmental services and usually do not have inherently environmental services. Usually do not have inherently environmental characteristics; it is their use to provide environmental services that qualifies them as environmental goods. Type B category includes Environmentally Preferable Products (EPPs), including both industrial and consumer goods. These goods have environmentally preferable characteristics relative to substitute goods, i.e., reduced negative environmental impacts in production, end-use or disposal and are generally used for purposes other than environmental ones in commercial and household applications (Kumar 2002). 6
  10. 10. The classification of (trade in) ―environmental‖ services in the context of ongoing WTO negotiations is based on the concept of human-activities-related services. Two major subcategories are infrastructure-related services, such as sewage, refuse disposal and sanitation services, and environment-related commercial services (UNCTAD 2003). Table 1. CPC and GATS Categories of Environmental Services CPC Division 94: Sewage and Refuse GATS Sectoral Classification 6: Disposal, Sanitation and Other Environmental Services Environmental Protection Services 9401 Refuse Disposal Services A. Sewage Services 9402 Refuse Disposal Services B. Refuse Disposal Services 9403 Sanitation and Similar Services C. Sanitation and Similar Services 9404 Cleaning Services of Exhaust Gases. D. Other 9405 Noise Abatement Services. 9406 Nature and Landscape Protection Services. 9409 Other Environmental Protection Services n.e.c. Source: (UNCTAD 2003, Environmental Goods and Services: Challenges and Opportunities for Central American and Caribbean Countries. Geneva : UNCTAD) 7
  11. 11. Environmental services have been defined as: (a) services provided by ecosystems (e.g carbon sequestration); or (b) human activities to address particular environmental problems (e.g. wastewater management) (Cattafesta 2003). 2.2 General Direction of Negotiations on EGS Negotiations in this field are being carried out with the following objectives:  Support member countries in taking measures to improve their environment.  Promotion of production and trade in environment friendly products.  Development of environmental goods and services industry.  Adoption of environment friendly technologies (Joshi 2003). On the basis of submission to the WTO, proposals put forward by various countries can be put in the following categories: (i) APEC list (ii) Items in OECD list which are not included in the APEC list (iii) Inherently environment friendly products (iv) Products made using environment friendly processes (npr-PPM) (v) Japanese proposal including energy efficient consumer products and CFC free products (vi) Qatar‘s proposal of products using low carbon, energy efficient technologies (vii) Proposal by Taiwan to identify 30 unique tariff lines from APEC list (viii) A common list and a development list approach given by China 8
  12. 12. The focus of deliberation is on the following points:  Should there be a relationship between a country‘s requirements in the environmental sector and the market access commitments?  Does the WTO have any role to play other than in trade liberalization?  Is greater coherence between different international organizations required?  Does trade liberalization in EGS enhance welfare in developing countries? (Joshi 2003) Many members propose ‗list-based‘ approaches instead of seeking prior definitional clarity on environmental goods. For example the US proposed a ‗core-list‘ (on which consensus exists) and ‗complementary list‘ for which individual countries could nominate products. Faster liberalisation is ‗envisaged‘ for core-list products (zero tariffs by 2010) and liberalisation of a minimum of x% on goods in complementary list (which Members could choose) (Suathan 2004). China (TN/TE/W/42) has called for a ‗common-list‘ including goods of export interest to both developed and developing countries and a ‗development list‘ (for Special & Differential (S&D) treatment born from the common list) list which would include those goods from the common list eligible for exemption or a lower level of reduction commitments (Ibid.). On specific products only Japan (TN/MA/W/15) and Qatar (TN/TE/W/19) and Taiwan have submitted proposals. Japan‘s list includes products from both APEC and OECD lists 9
  13. 13. plus some additional products. Energy efficient consumer equipment is notable. Qatar has proposed efficient, lower carbon pollution emitting fuels and technologies. Taiwan‘s submission focuses on pollution control equipment (Ibid.). 2.21 Environmental Goods There are broader categories of environmental goods suggested by various groups/members so far during the negotiations. Interestingly, none of the countries agree on a definition of EGS. Canada, Japan and the United States have adopted broad definitions of the environment industry. Italy, Germany and Norway, on the other hand, have chosen narrow ones. The European Commission‘s (EC) definition (1994), includes clean technologies whereas other definitions, including that used in the Organisation for Economic Co-operation and Development (OECD) study (1992), tend to exclude clean technologies (CUTS 2004a). Earlier discussions focused on the definitional aspects and now in the Negotiating Group on Market Access (NGMA) some of the Members have expressed views that the negotiations should take place on a ‗list approach‘ rather than follow the definitional route. Some definitions have been given, but agreement on a common definition has never been reached. Efforts are ongoing to carve out a WTO list from the OECD and APEC lists; some countries have given a list but work is still going on. There have been 9 submissions so far – all from developed countries (Kumar 2002). 10
  14. 14.  OECD/APEC lists mostly contain products of which developing countries are net importers.  There are a few products in the OECD/APEC lists for which developing countries (as a group) are net exporters such as methanol, ethanol, mats and screens, fluorescent lamps and plastics. Most top exporters are middle income or emerging economies such as Mexico, Singapore, Korea, Malaysia and Brazil (UNCTADTD/B/COM.1/EM.21/CRP.1). Several developing countries argue that the product coverage of environmental goods would need to include more products of export interest to them. Some WTO members have also argued that environmental goods should include goods produced in an environmentally friendly manner (e.g. goods identified on the basis of Process and Production Methods (PPMs)). Examples include renewable-energy products, biodegradable products from natural fibers such as jute and coir, recyclable products, non-timber forest products, etc. India (TN/MA/W/10) for example has supported inclusion of environmental friendly products such as jute products or those based on biodiversity (Singh 2004b). Environmentally Preferable Products (EPPs) are distinct from pollution-control goods and technologies as environmentally beneficial effects arising during course of production, use or disposal in terms of less pollution or greater resource-efficiency. They are not used to treat or deal with environmental problems as such. For most developing countries, products of export interest lie in EPPs rather than environmental equipment, 11
  15. 15. per se. However a number of EPPs such as those based on energy-efficiency (for example refrigerators) raise issues of appropriate classification and evolving technologies (Suathan 2004). Organic products are different from other goods because they are inherently environmentally friendly (through their impact on human health, etc.). It is felt that such goods must have different customs codes assigned under the international customs system known as the Harmonised System (HS), which is maintained by the World Customs Organisation (WCO). The six digit codes, which are regularly updated by the WCO to take account of changes in technology or patterns of international trade, are based on national customs codes. In the latest amendments to the HS codes in January 2002, the WCO, for the first time, included social and environmental fields, particularly relating to products under certain MEAs (Multilateral Environmental Agreements), including CITES, the International Convention on the Conservation of Atlantic Tunas (ICCAT) and the Basel Convention. Amendments to the HS codes, in order to differentiate between products based on their environmental characteristics, are arrived at through fairly protracted deliberations in the WCO. As a start, such customs codes may need to be developed at the national level and then gradually be harmonized. This issue may also provide an opportunity for developing countries to play a more proactive role in the WCO to ensure that their trade interests are taken into account in the development of customs codes (Chaytor 2003). 12
  16. 16. The EC is a major proponent of using process-based criteria (PPMs) to include goods produced in an environmentally friendly manner. India has made it clear that it is against the inclusion of goods that are produced in a manner that is ‗environmentally friendly‘ (i.e. differentiated on the basis of PPMs). Chile in its submission to the WTO strongly opposed the definition of environmental goods on the basis of PPMs stating: ‗there is no place in the GATT framework – nor is it acceptable – for any possible definition of environmental goods to include the concept of production processes and methods.‘ Similarly, the Republic of Korea has argued that the environmental goods ‗should be determined in terms of their end-use, but not in terms of their production and process methods.‘ Under the WTO rules, it is not permitted to discriminate against products based on PPMs. Therefore products like organic foods and certified timber products are ruled out of this category (CUTS 2004b). 2.22 Environmental Services Services are currently being negotiated in the Committee on Specific Commitments on a bilateral basis, as WTO members respond to each other‘s requests, and thus, it is likely that in the short term members will use a variety of different classifications for environmental services. Meanwhile, the Committee on Trade & Environment Special Session (CTESS) has not yet played the guiding role it has been given on the definitional issues. The Quad countries (EC, US, Canada, and Japan) are likely to push strongly for a broadening of the W/120 classification (CUTS 2004b). Since the WTO already had a basis for the classification of environmental services (i.e., W/120), the negotiations on 13
  17. 17. environmental services are considerably more advanced than those on environmental goods (CUTS 2004b). The broader OECD definition/classification has found favour with some developed countries, such as the EC, US, Canada, Japan, Switzerland and Australia. Adopting a core listing approach, the US is in favour of a new classification that incorporates a list of environmental sectors that are significant to the provision of environmental services, e.g., construction, engineering and consulting. The US also mentions the need to focus the classification on pollution prevention, rather than ‗end-of-pipe‘ clean up services, i.e., goods that are used to clean the environment or prevent pollution. Canada also proposes the use of clusters in the negotiations, as a check-list. The EC has suggested an advanced definition that offers more categories than the W/120 classification, based on what it considers ‗pure‘ environmental services. Such services would be the subject of a cluster negotiation, so that they would fall within other sections of the GATS (avoiding the mutual exclusivity pitfall). Australia and Switzerland are broadly in favour of the EC‘s approach. Switzerland is of the view that there are several fields of activities that would accommodate the gradual integration of environmental services, which include: professional services relating to the environment, consultancy, sub-contracting and engineering relating to the environment, and construction relating to the environment. Developing countries have not made express proposals on environmental services, apart from Colombia, which emphasized pollution control and waste management. It accepts the EC classification as a working basis, but would add three further services: (i) the 14
  18. 18. implementation and auditing of environmental management systems; (ii) the evaluation and mitigation of environmental impact; and (iii) advice in the design and implementation of clean technologies. Cuba calls for differential treatment in order to enhance the competitiveness of developing countries (Ibid.). Various points are being raised over different proposals on EGS submitted by various countries. Qatar‘s proposal on natural gas raises the question as to whether natural resources can also be considered as environmental goods and benefit from lower tariff and non tariff barriers (NTBs) (including subsidies to alternative fuels to coal). If the intention is to promote environmentally friendly fuels, ‗relativity‘ considerations must be kept in mind. E.g.: Hydrogen>Ethanol>natural gas>petroleum>coal. What would happen to trade-preferences to natural gas once use of ethanol or hydrogen becomes common? Again lowering barriers should also look not only at tariffs but also internal taxes, subsidies that may provide strong incentives or disincentives to use a particular fuel. Japan‘s proposal on energy-efficient products raises issues of how appropriate tariff classification distinctions and trade preferences will be created, say for example, between a normal and energy-efficient washing machine, the latter which may become obsolete the following year as technology improves (Suathan 2004). Brazil, Cuba and India highlighted the problems through submissions; in the discussions in CTESS. Several problems with the ―list approach‖ have been identified. The list approach is too diffused to meet environmental objectives. It appears basically to address only market access objectives. Most of the developing countries are net importers. Export from the 15
  19. 19. South is basically to the South; imports are from the North. This will affect small and medium enterprises, which comprise 60% of the industrial base. It is further indicated that there is always a need to negotiate as reflected in the ‗living list‘ concept (New Zealand proposal) which changes the balance of rights and obligations arrived at the negotiations (Kumar 2002). Dual and multiple uses of EGS, e.g. electricity meters, heat exchangers, microwave ovens, etc. also make it difficult to earmark them separately. There is no synergy between goods and services. Many environmental activities entail delivery of services. There is a lack of technology transfer mechanism; most of the environmentally sound technologies are protected by Intellectual Property Rights and many instances of unsuitable equipments being transferred to developing countries have been noted (Ibid.). India has proposed the Environmental Project Approach. The objectives of the approach are as follows:  To bring trade liberalization to meet environmental and developmental goals.  To bring synergy between environmental goods and services.  To address diversity in environmental standards.  To bring common but differentiated responsibilities.  To give policy space to national governments.  To bring market-based initiatives for environmentally friendly goods and services through capacity building – the World Summit on Sustainable Development also supports this (Ibid.). 16
  20. 20. According to India an Environmental Project includes any activity with a view to achieving environmental objectives. Goods and services used in the project are to be decided by a National Designated Authority (DNA) on the basis of techno-economic valuation in a specified period of time for specified national environmental objectives. Tariff concessions for the project period need to be considered. Both public and private projects can be included – some threshold can be put. Many countries already have something like this – e.g. India and Thailand. This is compatible with the Harmonized System of classification – Chapter 98 of the WCO Book (Ibid.). India has given the following advantages of the ‗Project Approach‘ in support of its argument:  This approach is cohesive and integrated – goods and services – OECD study (1st July 2005) – potential benefit more for Developing Countries (DCs) if simultaneous liberalization in goods and services.  It is focused and direct – to the goals of environmental objectives.  It can accommodate changing needs of global environmental requirements.  Some of the positive measures include:  Technology transfer – with the services, leading to capacity building.  Does not affect market access schedules of the goods – does not lead to ―zero-forzero‖ Sectoral non-agricultural market access (NAMA) negotiations.  It also enhances mutual supportiveness of trade and environment – Para 31(iii) objective (Ibid.). 17
  21. 21. India claims that the Project Approach also achieves Transfer of Technology (ToT) objectives. Transfer of Environmentally Sound Technologies (ESTs) is expected to increase compliance with the Technical Barriers to Trade Agreement (TBT) and the Agreement on Sanitary and Phytosanitary Measures (SPS), to give more market access in developed countries, enhance indigenous capacity building in EGS, and increase compliance with MEAs. Imports of ESTs are expected to increase the exports leading to net trade gain – (+) and reduction in overall cost of the global economy. More availability of EGS reduces the cost to the environment and improves environmental benefits (Ibid.). 3.0 Overview of India’s Environmental Goods and Services Industry In India, the environment has emerged as a distinct industry in recent years. Today, there is a wide range of EGS. These include products that minimize material and energy use, reduce environmental risk, and prevent pollution right at the source. This sector was virtually non-existent in India until two decades ago. Nonetheless in the past decade, with increasing environmental awareness in all sections of society and positive response by the industry and government, India has been turning into a promising market for EGS. India‘s current spending on environmental protection is approximately to the order of 0.5% of its GNP compared to 1-3% in developed nations. The environmental infrastructure services segment is in the realm of Urban Local Bodies while environmental support services have traditionally been part of integrated engineering consulting services. The first comprehensive estimate of the Indian environment market including equipment and services was made for the year 1994 and valued at US$1.9 billion by Confederation of Indian Industry (CII) – 1996. However, the estimate was 18
  22. 22. conservative since it did not cover segments like industrial non-hazardous solid waste treatment or sanitation. The estimates were based on secondary data collected from government agencies, industry suppliers and multilateral and bilateral assistance agencies. A more recent estimate, in 2002, valued the Indian environment market at US$ 4.36 billion, with an annual growth rate of 15 per cent. In 2000, the market was estimated at US$ 3.29 billion, and in 2001 at US$ 3.79 billion. The market estimate included environmental management technology, equipment and services, including clean and renewable energy (Sawhney & Chanda 2003). The domestic environmental industry in India is still highly disorganized and is dominated by the Small Scale Industry units that lack the resources to invest in Research and Development as well as in marketing and servicing infrastructure. The environmental business is shared by a number of entities including equipment suppliers, system suppliers, engineering procurement and construction contractors, consultants and service providers. Table 2 summarizes the role of different entities and overall composition of the industry. Table 2. Composition of Indian Environmental Industry Business entities Details of products and services Equipment suppliers (specialized) Manufacturers of filter presses, oil separators, dust collectors, bag filters, electrostatic precipitators, etc. 19
  23. 23. Essentially contractors who put together various System supplies equipments and who guarantee performance of the system (water treatment or dust emission control, etc.) Used in the conditioning of water or wastewater as Chemical suppliers part of the treatment process. Engineering procurement and The environment projects are part of larger construction (EPC) packages done by entities who may not have the contractors/lump sum turnkey process know how, but are able to put together contractors several packages and implement the whole project with their project management and construction capabilities Consultants They provide concept development, project budgeting, detailed engineering, environmental impact assessment, troubleshooting, environmental audit, and a variety of such services. Build Own Operate and Transfer Not very common now, but the future holds 20
  24. 24. (BOOT) and Build Own Operate enormous scope for outsourcing the water/waste (BOO) Operators water treatment and facilities management to third parties, allowing companies to focus on the core area of their business. Analytical services like Suppliers of monitoring and analytical equipment laboratories, etc. and laboratory services providers. Source: Singh, Sandeep, ―Trade Preferences and Growth of Environmental Industry: Issues and Implications for India‖, Indian Journal of Economics & Business, Vol. 3, No.2, 2004, p. 293. The total environmental market in India was estimated to be around US$8 billion in 2000 and is expected to grow to approximately US$ 13 – 14 billion by year 2005. Active financial participation of multilateral and bilateral agencies in large urban environmental infrastructure projects has also helped to a large extent in this regard. There are many successful joint venture partnerships with countries like USA, UK, Germany, Netherlands, Canada, and Sweden, etc. The market in India for environmental business in pollution control equipment is estimated to be growing around 10 – 12 % per annum. The development of the Indian environmental industry in the past two decades reveals that the growth has been essentially demand driven. The Central Pollution Control Board 21
  25. 25. was constituted in 1974, essentially to implement provisions of the Water (Prevention and Control of Pollution) Act. Subsequently a full-fledged Ministry of Environment and Forests was established in 1985, and a comprehensive Environment Protection Act came into being only in 1986. Thus the environmental industry took off only after 1986 (Mattoo & Stern 2003). In response to increased demand for pollution control equipment as a result of stricter regulations and laws, some Indian companies started manufacturing some of these products while many other such equipment, where demand did not justify domestic production or where the technology was not available, continued to be imported from companies outside India. Hazardous waste treatment is another area where the demand for EGS is increasing rapidly. It has been estimated that approximately 5 million tonnes of hazardous waste is generated annually in India, most of which is in the four highly industrialized states of Maharashtra, Tamil Nadu, Gujarat, and Andhra Pradesh. As the market is in the early stages of development, there are several technological gaps that produce opportunities for imported technologies and goods. Indian companies do not have advanced technologies in the areas of cyanide and phenolic waste treatment, solidification and stabilization of solid waste, and plasma and hydrogenation technologies. The air pollution control segment also represents a big slice of the overall market. As per estimates, the Indian market in air pollution control and management is estimated at US$ 22
  26. 26. 408 million. India‘s air pollution control industry has developed capabilities for manufacturing a diverse range of equipment for dust collection in the stationary air pollution control subsection. India‘s expertise is, however, limited in the case of special gaseous pollutants. Since certification and labeling are essential to endorse the eco-sensitivity of commodities and compete in the global market, firms in developing countries are increasingly moving towards the introduction of environmental management systems. On the industrial front, the ISO 14001 certification is the most popular tool to indicate environmentally friendly management systems worldwide. Indian industry also has responded positively to this challenge, as can be seen very clearly. The ISO survey 2003 reveals that ISO 14000 certificates have increased from 1 to 879 between 1995 and 2003 and ISO 9000 certificates have increased from 1023 to 10,198 in the same period. As per estimates by the Confederation of Indian Industry (CII), India has approximately 350–400 pollution control equipment manufacturing and environmental consulting companies. Over 100 companies in India are associated with international companies in the form of joint ventures and technology transfer agreements for various types of pollution control equipments (Singh 2004a). Trade liberalization in India systematically removed trade barriers and restrictions on FDI, post-1991. Investment in the environmental services sector has been autonomously open with 100% FDI in India; domestic firms are engaged in both joint venture and long- 23
  27. 27. term strategic partnerships. Joint ventures have been prominent in the Indian environment industry, and over 100 companies have associations with international companies in the form of joint venture and technology transfer agreements for various types of pollution control equipments. While there are various joint ventures and collaborative arrangements in the environmental goods sector (between 100 to 150) there are fewer arrangements in environmental consultancy services sector. Foreign direct investment (FDI) in environment equipment and services (i.e. manufacture of pollution control equipment, sewage, refuse, and consultancy services) are allowed under the automatic route with up to 100 percent foreign equity holding. However, foreign investment has been largely routed through the Foreign Investment Promotion Bureau (FIPB) in India, since it comes with a written approval of the Government of India. Thus while the automatic route is open for foreign investment in environmental services, the FIPB has been approving several of these projects. During 1993 through 2002 the total FDI in the environment sector approved by the FIPB amounted to US$ 32.7 million. The largest share of this foreign investment came from the US (US$ 10.42 million $, 31.86% of all countries), followed by the Netherlands (US$ 7.63 million or 23.33% of all), Singapore (US$ 5.93 million, 18.65% of all), UK (US$ 2.83 million, 8.65% of all) and Germany (US$ 2.11 million, 6.45% of all) (Sawhney & Chanda 2004). In 1991–2 there was no FDI or foreign technology cases (FTCs) in the environment sector approved by the FIPB in India. Countries like Canada consider the prospects for investment. Countries like Mauritius, Italy, Denmark, France and Japan also invested in Indian environmental industry in terms of capital or technology. 24
  28. 28. Some of the Indian environmental services firms have established long term strategic partnerships with foreign firms to enhance their skills in selected niche areas: for example, in 1997, Technofab Engg (India) formed Tetra Tech India Ltd under a joint venture with Tetra Tech EMI (US) to offer consultancy and engineering services in environment, energy, and infrastructure. Engelhard Environmental Systems (India) Ltd., a joint venture of U.S.-based Engelhard Corporation and India-based UCAL Fuel Systems Ltd., has started production at India's first auto-emission catalyst plant. Foreign companies have also opened subsidiaries in India to take advantage of lower cost of manufacturing there. Companies like Pentair Water India Ltd., Hindustan Dorr-Oliver Ltd., IRG Systems South Asia Ltd., Acres International and Montgometry Watson Consultants India Private Ltd. have opened subsidiaries in India in producing environmental products (Singh 2004a). An increasing number of Indian companies are seeking expertise in the EGS sector from other OECD countries. They have been receiving good responses from companies in the US, Germany, Netherlands, Japan, Italy, and Canada. Several European and US players have already established their presence and market share through partnerships with Indian firms. These companies are setting up shops considering not only the domestic market but also the cheap and trained manpower. A few big Indian engineering companies like Thermax Ltd, Engineers India Ltd, and BHEL (Bharat Heavy Electrical Ltd) offer services and equipment as part of turnkey consulting services. Of late many Indian companies have entered into joint ventures with 25
  29. 29. companies and some US companies have also started setting up wholly owned subsidiaries after the government permitted 100% FDI for equipment manufacturing and for consulting/management services in the sector. U.S. suppliers of environmental products and services have found India to be a receptive and profitable market in recent years. As India globalizes its economy and struggles to cope with environmental concerns exacerbated by its high population growth and urbanization, U.S. solution providers are discovering increasing opportunities. Foreign Affiliation in the Indian Environment Industry and Selected Environmental Joint Ventures are furnished in Table 3 & 4. Table 3. Foreign Affiliation in the Indian Environment Industry Indian Company Foreign Partner General Electric Company of India, Ltd American Air Filter International SA Paramount Pollution Control Pvt. Ltd. Anderson Flakt India ABB Environmental Services Hindustan Development Corporation Ltd. C-E Air Preheater Combustion Eng. Thermax Limited Babcock & Wilcox, USA, General Electric Environmental Services, Inc. Saraswato Omdistroa; Sumdocate Smith & Loveless Humphreys & Glasgow Ltd. Jacobs Engineering Ltd. 26
  30. 30. Source: Sawhney, Aparna and Chanda, Rupa (May 2003) ―Trade in Environmental Services: Opportunities and Constraints‖ Working Paper No. 102, Indian Council for Research on International Economic Relations (ICRIER), New Delhi, p. 58. Table 4. Selected Environmental Joint Ventures Company Foreign partner Vestas RRB India Limited Vestas Wind System A/S, Denmark Tata BP Solar India Ltd. BP SOLAR (a wholly owned subsidiary of the erstwhile British Petroleum), the UK Suzlon Energy Ltd. Sudwind Energie, Germany BHEL-GE Gas Turbine Services General Electric, the US Flakt India Ltd. ABB Environmental Services Kirloskar Electric Ltd. Wind Energy Group, UK; NEPC, India Hindustan Development Corporation C-E Air Preheter Combustion Engineering Ltd. 27
  31. 31. Paramount Pollution Control Ltd. Anderson, the UK Thermax Ltd. Babcock & Wilcoz, US, General Electric Environmental Services, Inc. Humpherys & Glasgow Ltd. Jacobs Engineering Ltd. Source: Singh, Sandeep, ―Trade Preferences and Growth of Environmental Industry: Issues and Implications for India‖, Indian Journal of Economics & Business, Vol. 3, No.2, 2004, p. 297. 4.0 Challenges and Opportunities for India The market for environmental services in developing countries such as India has been growing due to increased environmental regulations, urbanization, and industrialization. In 2001, about 28% of the billion plus Indian population (about 285 million) were living in cities and the proportion of urban population is expected to further increase to 40% by 2021. Moreover, enhancement in the set of domestic environmental regulations, liberalization and increased private participation in municipal activities during the last decade has increased opportunities for trade in environmental services. An attempt has been made in this section to examine the import export structure of environmental goods of India as per APEC List for five years i.e. from 1998-99. Despite the presence of a large number of domestic players and setting up of many joint ventures 28
  32. 32. with foreign companies to cater to the demand, a large number of environmental goods are required to be imported into the country. Indian imports in this category are quite significant as compared to exports. Moreover, imports exceed exports in almost all the items for all the five years i.e. on continuous basis except a few items. As can be seen from Annexure 1, India faces deficit in the balance of trade in 84 items out of 100 environmental products traded by India. (Based on author‘s own analysis of data downloaded). Major export and import destinations of Indian environmental goods have also been identified in Annexure 2. US, EU, UK, Germany and in some cases Japan are the major developed countries where environmental goods are exported. For most of the items major export destinations include countries like Sri Lanka, Puerto Rico, Greece, Algeria, Iraq, Iran, Nigeria, Nepal, Laos, Trinidad and Tobago, Qatar, Malawi, Zimbabwe, Malaysia, Yemen, Myanmar, Niger etc. A great fluctuation of major export destination from year to year has been noticed. For example in 2002 the export of 902810 (Gas Meters) to Egypt was very small while in 2003 Egypt became the major destination for Indian export for the same product. India imports from many destinations, but Germany and USA are the major countries from where most of the commodities are being imported. The sub-total of the last five years imports and exports of environmental goods on the basis of the APEC list made in Annexure 1A reveals that percentage of these goods in total exports and in total imports is 0.01 % and 0.02 % for the last few years, which is 29
  33. 33. very insignificant. The growth rate (compound annual growth rate (CAGR) from 1998 to 2003) of Indian exports and imports of environmental goods has been calculated & items have been ranked accordingly in Annexure 4. Analysis of 100 environmental goods considered here reveals that although the rate of growth is positive for 83 export items, the rate of growth is not very significant and less than 1 in 82 products. The number of items in which the rate of growth is positive is much more for imports as compared to exports. The same way that the rate of growth of imports is positive for more than 60 items as can be seen from Annexure 3. Revealed Comparative Advantage Index has been calculated (formula given after the endnotes) for identifying high export potential environmental products. This has been done in two ways. First, these export products have been ranked in terms of growth and the Revealed Comparative Advantage (RCA) of the top 20 products has been calculated (Annexure 6). It is found that for those products India does not have comparative advantage. But, then export items have been ranked according to value in 2002 and RCA has also been calculated for those top 20 export products (Annexure 5). The analysis reveals that India has comparative advantage in 4 products only viz other centrifugal pumps, other instruments for measuring and checking electrical quantities excluding electricity meters and other refractory ceramic goods. As has been already mentioned, trade balance of India is negative for 84 environmental products. India has comparative advantage in only 4 products among our top 20 exported products in terms of value. Again the tariff data shows that our tariff rate is much higher 30
  34. 34. than the corresponding tariff rate of developed countries. That means if India reduces tariffs of the environmental products as demanded by the developed countries, it will go against India‘s terms of trade. 4.1 Multiple use and customs policy For customs policy purposes and trade nomenclatures, a good is defined and assigned to a product code according to its physical characteristics: e.g. size, material, principal inputs. However, in investigating environmental goods interest revolves around how the product is to be used, which is quite difficult given the possible multiple uses. In narrower definitions there are also problems in determining the contents of a list of ‗environmental goods‘. The most serious concern is the multiple uses of environmental products. For example, separating harmful waste products from the output stream calls for a centrifuge. Yet centrifuges have a host of industrial uses, which are not necessarily environmental. An attempt is made to examine these goods on the basis of their use. The list of goods which have more than one use is given in Annexure 7. There are many items in the list that are not predominantly used for environmental purposes. In fact, there are many general industrial types of equipment, which may or may not have any use at all for environmental purposes. The list includes equipment with multiples uses such as pumps, condensers, millimeters and refractory bricks. Therefore, duty reduction on such general industrial items will also have significant ramifications for other sectors of industries like manufacturers of fans, pumps, and scientific laboratory equipment (Singh 2004a). 31
  35. 35. 4.2 Reduction v/s elimination of barriers Developing countries are apprehensive that any indiscriminate tariff reduction would increase their deficit. In the identified goods and services what level of elimination or reduction should be appropriate given India‘s trade interests as well possible environmental benefits needs to be analysed carefully. Data on customs tariffs for environmental goods as per the APEC List has been compiled for the years 2003-04 and 2004-05. It further reveals that customs tariffs on environmental goods in India have been revised in a downward direction. It reveals that only in the case of commodity no. 230210 (of maize (corn)) the rate of duty remained unchanged at 30% in 2004-05. For the majority of environmental goods tariffs in the previous year were 25%. While in 73 items the tariff has been reduced from 25% to 15%, for 6 products this has been reduced to 10% from the earlier level of 25%. For 19 products the tariff has been pegged at 10% in 2004-05 from 30% in 2003-04. For product No. 854140 (photosensitive semi-conductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light emitting diodes) and 902610 (for measuring or checking the flow or level of liquids), 902620 (for measuring or checking pressure) the tariff was 15% in the previous year while these have become free in this year. Some products viz 902680 (other instruments or apparatus), 902720 (Chromatographs & Electrophoresis Instrument), 902750 (other instruments and apparatus using optical radiations (UV, visible, IR)) and 902780 (other instruments and apparatus) the duty has been reduced to zero from the 10% tariff obligation of previous year. For the product 902690 (Parts & Accessories of Instruments/Apparatus of Heading 32
  36. 36. 9026) the tariff was merely 5% in 03-04 and now it has become duty free. So, currently for 92 items India has tariff of 15%, for only 6 items it has 10% duty and for 9 items now India has removed the tariff barrier. Indian industry‘s feedback on tariff reduction is as follows: 1. Tariff reduction would provide more choice to the users of these types of equipment. In many cases, these equipments are used as inputs for pollution control systems and projects carried out by the environmental industry. 2. Tariff reduction in the case of stand alone equipments wherein several components are imported from other countries may lead to a tariff structure with high tariff anomalies where duty on components would be higher than on finished goods. 3. Reasonable import tariffs are often incentives for foreign investors to set up their production base in India, especially in a fast growing area like environmental management equipments. Extremely low or zero tariffs might discourage companies to make such investment decisions and adversely affect procurement of more local components. With a drastic reduction in tariffs, foreign companies will prefer to export goods from their own countries rather than investing in India. 4.3 Environmentally Preferable Products (EPPs) Environment and ecology occupy a prominent place among the key focal issues faced by the world today. EPPs are generally described as products that, from a life-cycle 33
  37. 37. perspective, cause significantly less ‗environmental harm‘ than alternative products that serve the same purpose (UNCTAD, 1995). In an era of degenerating environment, efforts are on to produce 100% Eco-friendly textiles where even the cotton will be grown without chemical fertilizers. This is already being done in India in the form of Ponduru Khadi which is produced from wild varieties of cotton found in the mountain terrain of the Eastern part of Andhra Pradesh, in the South of India. India, like other developing countries, might have an advantage through the inclusion of such products from the list of environmental goods, provided such classification is not based on non-product related process and production methods (npr-PPM). India has indicated its support for the inclusion of environmentally friendly natural products of export interest such as jute, coir, rattan, handloom products, handloom furnishing materials, textiles & clothing made using natural dyes, non timber forest products and bamboo in the list of environmental goods. These products are natural, biodegradable, and substitutes for other goods that adversely affect the environment, for example, jute as a substitute of plastic. Khadi products can also be included in this category. Khadi is defined as a coarse homespun cotton cloth made in India. Khadi is acknowledged as one of the coolest and most comfortable fabrics ever known. Since Khadi deals in natural fibers viz. cotton, silk and wool only, spun and woven in natural environment, it can boast of being 100% natural, unlike handloom and mills which receive cotton yarn, blended with some regenerated cellulose fibres. Khadi dyed in Natural dyes also makes a perfect 34
  38. 38. combination for a green fabric. Some more items which can be of interest for India are furnished in Annexure 8. 4.4 India’s Export Potential for Environmental Services The privatization and liberalization of environmental markets promises the standard free trade benefits to countries based on individual comparative and competitive advantage of providing environmental services. To quote Indian Council for Research on International Economic Relations (ICRIER) Research Paper by Aparna Sawhney and Rupa Chanda, ―developing countries like India have the scope of specializing in labour-intensive environmental services, including skilled segments like environmental consulting, auditing, analysis, and training.‖ Indian environmental service providers have emerged most significantly in two areas: first, environmental services in turnkey projects (e.g. integrated engineering services in energy equipment); and second, environmental support services such as consulting, environmental impact assessment, auditing, and training (including ISO 14001). There are also a few companies, which have been specializing in composting of solid waste and waste to energy services. Large Indian environmental equipment firms offering accompanying environmental services have been exporting equipment to Asian, Middle Eastern, and African markets. They have also begun to explore niche markets in the environment sector within 35
  39. 39. industrialized countries, to boost exports and also to nurture future partnerships and alliances for technology solutions. New investment and expansion in the environmental services sector in developing countries can provide employment opportunities for unskilled as well as skilled labour, as some of the environmental segments are labour intensive (e.g. waste management, sanitation, consulting, training, etc). Moreover, since environmental services are typically provided in conjunction with other products or services, as the environmental services sector expands so would new demand be generated in other sectors including, engineering and design, construction, research and development, training, consulting (Sawhney 2003). The environmental support services segment constitutes a relatively small share in the global environmental services industry, and is declining in developed countries. In developing countries, however, the demand for these services is on the rise as witnessed within India. Since the environment markets in the OECD countries are quite mature and saturated, India‘s export potential in this sector is primarily to developing countries, where the demand for environmental services is growing. Indian environmental service providers could specialize in services in regions where there are similarities in ecological and economic conditions. Thus India has opportunities in this segment in some developing countries in South Asia, Africa, and the Middle East, where environmental support services are increasingly in demand (Sawhney & Chanda 2004). Indeed, India has exported environmental consulting services, including training in ISO 14000 and 36
  40. 40. auditing, to countries including Nepal, Sri Lanka, Nigeria, Egypt and Qatar (Sawhney 2003). Several Asian countries, including India, have been the focus of the US environment industry, given the growth prospects of their domestic environment sector, under the United States-Asia Environmental Partnership (US-AEP). In the environmental exports to Asian countries Japan is the leader (Ibid.). The important service sectors for India are water and wastewater management, solid waste services, protection of ambient air, remediation and ancillary services. The privatization and liberalization process in this sector must ensure a healthy balance between economic efficiency, social equity, and environmental sustainability. 4.5 Clean Development Mechanism (CDM) The Clean Development Mechanism (CDM) of the Kyoto Protocol, aimed at reducing the greenhouse gas emissions of industrialized countries, could become an important source of new finance for projects in developing countries. Developed country firms can begin meeting their reduction targets by funding emission reduction projects in the developing world and contribute to sustainable development in the process (UNCTAD 2005). The CDM, creates "win-win-win" synergies for the sustainable development of developing countries, by encouraging additional FDI flows to complement local financing of projects that contribute to local sustainable development. Brazil, China and India have the greatest potential for the new mechanism. Brazil was one of its pioneers, having proposed the initial concept and hosted the first such project. India has developed more CDM methodologies and project proposals than any other country (Ibid.) 37
  41. 41. Countries that rely heavily on coal for their energy needs and/or countries where the major energy users (e.g., power plants and heavy industries) are relatively energyintensive and inefficient would have the greatest potential for large and cheap CDM projects. By this token, both China and India can expect a relatively large share of the CDM market – together, they are projected to account for about 60 per cent of non-sink CDM projects (47 per cent and 12 per cent respectively). It is, therefore, certain that whatever the nature and scope of CDM projects that emerge globally, major coal-based GHG emitters such as China and India will play an important role (Gupta 2003). Despite near-term uncertainty about the size of the CDM market and the price of Certified Emissions Reductions (CERs), it is very likely that India will be a major player. This is also true in the long run where India along with other developing countries may take on some commitments and where emissions trading may be an important component of the GHG abatement architecture. While there are several issues of concern such as the impact of technical progress in abatement technologies on the gains from emissions trading for India, on the whole it may stand to benefit from participating in such trading. Furthermore, there are good prospects of convergence across CDM and emissions trading both in a short-run and in the long-run (Ibid.). Domestic companies produce much of what India needs by way of EGS. But their expertise is, however, limited in many cases and around 40% of the requirements are fulfilled by imports. However, most of the demand forecasts are based on large 38
  42. 42. manufacturing units‘ requirements. India has an estimated three million small-scale industrial units, which account for over 40% of the industrial output in terms of value, but their share of industrial pollution is disproportionately high. Smaller industries have the added burden of using obsolete, inefficient production processes, which are typically more polluting. In the future if these companies have to improve their environmental compliance, the demand for financial support will become very high. Indian environmental companies face significant hurdles, which not only deter them from exporting their products but also deter them from catering to the domestic demand. Some of the problems that Indian companies face include:  shortages of essential environmental goods such as membranes, activated carbon, resins, and other components;  limited R&D capability for technological improvements; limited servicing capability;  limited access to available technologies and potential foreign partners;  high capital costs for expansion;  limited domestic market in sub sectors;  lack of servicing and marketing network in other countries. There are many smaller firms that specialize in sector-specific equipments such as air pollution monitoring, wastewater treatments, etc. Several smaller companies offer environmental consulting services related to environmental management systems facilitation, environmental audits, environmental impact assessment and development of environmental standards. Trade liberalization through the WTO is likely to create many 39
  43. 43. challenges for smaller domestic companies with one or two product lines. Their products cannot compete with technically superior products from large companies. Moreover, they are unable to tap overseas markets in many cases due to the absence of marketing and servicing networks. Environmental services in R&D, design, and technology, which are an integral part of the environment equipment sector, are relatively poor in India. For instance, companies like Bharat Heavy Electricals Limited (BHEL) focus mostly on product-application research rather than basic research, and thus basic technology for equipment manufacture like gasifiers and fuel cells need to be imported. Indian firms offering environmental services do so as part of the equipment supply, especially for air pollution management solutions in power plants and vehicular pollution abatement. However, the Indian environment industry needs the technology (not equipment per se) and state of the art design for pollution management equipment, since the industry is capable of manufacturing the hardware domestically. Given the growth of Indian economy and high rate of urbanization, India needs massive capital to build its environmental infrastructure, particularly for water supply and treatment, sewage treatment, and solid waste management. The onus of providing environmental infrastructure services is with the Urban Local Bodies. However, financial constraints of these bodies have been a major problem towards ensuring adequate provisions of services such as sewage, sanitation, cleaning of roads, and water supply. 40
  44. 44. In the large projects funded by multilateral organizations, there are several conditions for eligibility that keep most of the Indian companies out of these projects. These strict eligibility criteria include past record, experience, turnover, product specifications, and third party guarantees Indian companies have to face several constraints due to their limited R&D capability for technological improvements, limited servicing capability, and high capital costs for expansion. Most of these companies being smaller do not have large marketing networks. 5.0 Conclusions and Recommendations The picture that emerges of the environment industry is one of an integrated, technologyintensive, globalised industry, which predominates principally in developed countries. The industry has largely been driven by enforcement of environmental regulations, and in this respect, developing countries are struggling to catch up. Developed countries, particularly US, EU and Japan are the largest producers, consumers and exporters of EGS. Developing countries are net importers of EGS. However, the EGS sector in developing countries is growing at a much faster rate than in developed countries. This makes developing countries markets important. Developed countries are pushing for the opening up of the EGS sector since they perceive different advantages from the opening of the EGS sector for developing countries. For example, in the first submission to the Committee on Trade and Environment Special Session and fifth submission to the NAMA negotiating group on 17th February 2005, the 41
  45. 45. European Communities wished to liberalize trade in EGS to bring economic, environmental and developmental benefits. They argued that in all countries, changes in consumption patterns and demand for greener products should be encouraged by opening up markets to environmental products from both developed and developing countries. Liberalizing trade in EGS would support and reward producers in all countries that invest in environmentally friendly practices, cleaner technologies and equipment with a view to meeting environmental objectives, related responsible corporate policies and/or consumers‘ demand. Supporting the development of environmental markets would also foster technological innovation and job creation in a dynamic industry. Moreover, for developing countries, it should help make available cheaper environmental technologies and related services needed to meet their developmental and environmental objectives, while satisfying basic human needs, such as improved access to safe water, sanitation or clean energy. A note by the UNCTAD Secretariat on EGS in Trade and Sustainable Development reveals that ―direct trade gains from liberalization in EGS may flow largely to the more advanced WTO Members, which stand to benefit from improved access to expanding EGS markets in developing countries. Efforts should be made to increase the potential for direct trade gains for developing countries‖ (WTO 2004). When WTO members are negotiating commitments in their respective schedules, the aim should be two-fold: (a) to liberalise market access in sectors and modes of supply of export interest to developing countries; and (b) to strengthen developing countries‘ 42
  46. 46. capacity in domestic services (including access to technology) and improve developing country access to information networks. As a negotiation strategy for EGS, developing countries should not be wary of making trade-offs. They may be able to advance their trade and environment agendas in the negotiations, provided they can forward plan and co-operate amongst themselves. Developing countries should take a two-pronged approach. They should examine the extent to which trade liberalization may enhance the availability of EGS used to address national environmental problems; and decide (a) which negotiated outcomes they wish to see emerge from EGS; and (b) how to derive real sustainable development outcomes from the result of their negotiations. Under the first approach, they must initially establish which pressing environmental problems they wish to resolve through access to EGS, and second, what desired level of market access they wish to achieve for their own EGS in foreign markets. Thereafter, they can match these goals with the relevant products and services and demand specific inclusion of such goods and services in the classifications to be determined in the WTO. In the second approach, developing countries should have worked out, in advance, how the achieved results of the negotiations will assist in providing real environmental quality 43
  47. 47. on the ground. For this, they must have in place plans for domestic regulation, covering environmental protection (including, for example, environmentally sound technologies, eco-labelling, etc.), infrastructure development, government procurement, intellectual property rights, and in some cases, even health and sanitation. They must also have strategies regarding international trade in order to continue to maintain their hard won market access. This may cover issues such as dispute settlement, subsidies, TBT, SPS measures and technical co-operation (CUTS 2004a). Developing countries will have to fully understand their capacity-building and technical assistance needs, in order to ensure that such assistance is well targeted and applied to support their environmental protection and trade objectives. In this way, developing countries may be able to achieve the ‗win-win-win‘ scenarios that are implied by the negotiations on liberalization of EGS. Moreover, the integrated manner in which traditional EGS are delivered is not reflected in the way the WTO classifies such goods or disciplines trade in these goods. The multiple uses of such goods and services (where it is unclear whether there is a clear environmental benefit from use or delivery) may cause problems in defining and classifying such goods and services, as well as assigning them specific HS (Harmonised System) codes to differentiate them from other goods. It is vital that developing countries develop both their own lists of products of export interest including organic agricultural products or products from traditional knowledge or 44
  48. 48. folklore and an alternative list of environmental services in which they hold comparative advantage. The WTO has been focusing on the elimination of trade barriers of sustainable resources and activities with a view to promoting the global living environment by further liberalizing trade in environmental goods. With the reduction or, as appropriate, elimination of trade barriers and increased trade flows, domestic purchasers will be able to acquire environmental goods and technologies at lower costs. The savings will help business and governments to stretch their capital investment budgets further, which could consequently help to ensure the mutual supportiveness between the environment and the promotion of sustainable development. Merely tariff reduction on end-of-the-pipe pollution control equipment will not lead to much needed technology transfer. On the other hand it may even adversely affect transfer of technology to India. In India, the most preferred and effective route of transfer of technology has been joint ventures. Therefore, any effort to reduce tariffs should take into account the fact that liberalization should not become an incentive for companies of developed nations to take a trading route rather than transferring technology to manufacture pollution control equipment in India. The lists proposed so far to a large extent do not cover products of interest to developing countries. It is important to note here that the provisions and mandate of paragraph 16 of the Doha Declaration is applicable to environmental goods. Paragraph 16 specifically 45
  49. 49. mandates special attention to ―products of export interest to developing countries‖ and takes full account of the special needs and concerns of developing and least developed countries. Therefore India should insist that the negotiations must focus on how developing countries can derive trade gains in terms of increased exports in this sector. The special needs also include protection of domestic industry, which is largely comprised of small and medium enterprises. Many biodiversity-rich developing countries, for example, have great potential for deriving commercial and developmental benefits from environmental services provided by their ecosystems. In most cases, however, the economic value of such services has not been established. Numerous ongoing studies and projects focus on valuation techniques and instruments to commercialize such services. Developing countries may have to coordinate and communicate between tradenegotiators and regional policy makers (trade, industry, agriculture, environmental, municipal authorities) as well as among various national stakeholders. Some elements which they have to consider are as follows:  In case organic products (based on whatever criteria) are negotiated as part of the EGS mandate on an accelerated basis, then the relationship to agricultural liberalisation modalities (export subsidies, domestic support) on non-organic products will have to be defined.  As EGS are frequently inter-linked it may be important to coordinate market access in both areas. For example: opening up the solid waste treatment services sector while maintaining high tariffs and non-tariff barriers (NTBs) on waste-treatment equipment 46
  50. 50. may not result in meaningful market-access unless perhaps the developing country has an adequate and competitive domestic environmental goods sector which could supply these services.  Liberalisation of goods having multiple end-uses (including environmental uses) requires careful consideration as it may be difficult to verify the intended ‗end-use‘ for such goods.  Tariff levels for most industrial goods are low in developed countries. NTBs may be more important, for example labelling, subsidies, taxes. Identifying and negotiating removal of these various NTBs will take time. This needs to be kept in mind given the time-horizon of completing the Doha negotiations as well as any accelerated liberalisation, if accepted, of EGS. The challenge will increase if agricultural goods are also negotiated (Suathan 2004). This case study of India reveals that India may not get too many advantages out of the opening up of environmental sector in the short run. Analysis of data reveals the following:  Environmental goods constitute a very insignificant share of India‘s total exports and imports.  Balance of trade is also deficit for most of the items.  Major destinations for environmental goods for many items are developing countries.  There is no consistency in their import demand. 47
  51. 51.  India has revealed comparative advantage in only 4 items out of the top 20 export items.  The highest growing export items do not have any revealed comparative advantage.  India‘s tariffs are higher than developed countries on environmental goods and reduction in tariffs may create disincentives for foreign firms to establish subsidiaries in India.  Most of the items, which developed countries are insisting for inclusion, belong to the category of multiple uses.  Unless the items of interest for India are included in the list of environmental goods, India may not benefit from the liberalization of the EGS sector in the short term. Potential benefits of liberalization of EGS will have to be examined in the context of FDI in the long run. India can benefit from the negotiations if the criteria for inclusion of a particular product category or a product is based on: (i) Use of the product/category in pollution control activities; (ii) Dynamic comparative advantage of India in that product/category which would be based on existing levels of import and export, size of domestic market, efficiency level of domestic industry and prospects for future; (iii) The degree of use in the environmental sector vis-à-vis other industrial sectors. The project approach suggested by India may benefit developing countries because: 48
  52. 52.  This approach is cohesive and integrated – goods and services.  It is focused and direct – to the goals of environmental objectives.  It can accommodate the changing needs of global environmental requirements.  Some of the positive measures include:  Technology transfer – with the services, leading to capacity building.  Does not affect market access schedules of the goods – does not lead to ―zero-forzero‖ sectoral NAMA negotiations.  It also enhances mutual supportiveness of trade and environment – Paragraph 31(iii) objective ( Kumar 2002). 49
  53. 53. Statistical Formulae Revealed Comparative Advantage Index Measures of revealed comparative advantage (RCA) can be used to help assess a country's export potential. The RCA indicates whether a country is in the process of extending the products in which it has a trade potential, as opposed to situations in which the number of products that can be competitively exported is static. It can also provide useful information about potential trade prospects with new partners. Countries with similar RCA profiles are unlikely to have high bilateral trade intensities unless intraindustry trade is involved. RCA measures, if estimated at high levels of product disaggregation, can focus attention on other nontraditional products that might be successfully exported. The RCA index of country i for product j is often measured by the product's share in the country's exports in relation to its share in world trade: RCAij = (xij/Xit) / (xwj/Xwt) where xij and xwj are the values of country i's exports of product j and world exports of product j and where Xit and Xwt refer to the country's total exports and world total exports. A value of less than unity implies that the country has a revealed comparative disadvantage in the product. Similarly, if the index exceeds unity, the country is said to have a revealed comparative advantage in the product. Compound Annual Growth Rate (CAGR) Interest rate at which a given present value would "grow" to a given future value in a given amount of time. The formula is CAGR = (FV/PV)1/n - 1 where FV is the future value, PV is the present value, and n is the number of years. 50
  54. 54. References Books, Journals and Working Papers Cattafesta, Catherin (2003) ―Diagnostico preliminar, República Dominicana”. Study prepared for the Ministry of Environment and Natural Resources of the Dominican Republic under the UNCTAD/FIELD project Building Capacity for Improved Policy Making and Negotiations on Key Trade and Environment Issues. Chaytor, Beatrice (2003) ―The State of Trade and Environment Negotiations within the WTO‖ in Mbirimi, Ivan and others chapter 10 “From Doha to Cancun: Delivering a Development Round”, London: Commonwealth Secretariat. Chimni, B.S. (January 12, 2003) ―WTO and Environment Legitimisation of Unilateral Trade Sanctions‖, Economic and Political Weekly: 133-139. Copeland, Brian R. and Taylor, M. Scott (August 1994) ―North-South Trade and the Environment‖, Quarterly Journal of Economics. CUTS (2004a) “Liberalising Trade in Environmental goods & Services” Research Report, CUTS CUTS (2004b) “Liberalising Trade in Environmental Goods and Services: In Search of „Win-Win-Win‟ Outcomes”, CUTS, Centre for International Trade, Economics & Environment, Jaipur. Gupta, Shreekant (October 11, 2003) ―India, CDM and Kyoto Protocol‖ Economic and Political Weekly; pp. 4292-4297. Hamwey, Robert and others (2003) “Liberalisation of International Trade in Environmental Goods and Services” in Sub-Regional Brainstorming Workshop on Trade and Environment Issues Contained in Paragraph 31 and 32 of the WTO Doha Ministerial Declaration – Project on Building Capacity for Improved Policy Making and Negotiation on Key Trade and Environment Issues, Bangkok, 30 July – 1 August 2003, UNCTAD, ITD & FIELD. Henriksen, Anna (1998) Voluntary Environmental Labelling and the World Trade Organisation, Institute of Economics, Copenhagen University. Hoekman, Bernard and others ed. (2002) Development, Trade, and the WTO: A Handbook, Washington DC, The World Bank. Howse, Robert (1998) ―Turtles Panel: Another Environmental Disaster in Geneva‖ Journal of World Trade 32(5): 73-100. 51
  55. 55. Joshi, Manoj (2004) ―Are Eco-Labels Consistent with World Trade Organization Agreements‖, Journal of World Trade 38(I): 69-92. ―Khadi, Commission for Khadi and Village Industries‖, Ministry of SSI & ARI, Govt. of India. Information available on website www.kvic.org.in/v4/homepage.asp Kumar, Sanjay, Director, MOC (August 11-12, 2002) “Approaches to the negotiations Under Para 31 (iii)”, Presentation in ―Regional Conference on the Agenda for WTO Hong Kong Ministerial : Challenges for South Asia‖ at FICCI, New Delhi. Liebig, Klaus (1999) ―WTO and the Trade-Environment Conflict: (New) Political Economy of the World Trading System‖, Intereconomics: 83-90. Mbirimi, Ivan and Others Ed., (2003) “From Doha to Cancun: Delivering a Development Road” Economic Paper 57, Commonwealth Secretariat, London. OECD (1997) ―Eco-labelling: Actual Effects of Selected Programmes”, OECD/GD(97)105, Organisation for Economic Co-operation and Development, France. Quick, Reinhard (2001) ―The WTO Dispute Settlement Mechanism-Trade, Environment and the Role of the NGOs‖, Journal of World Intellectual Property 4(2): 281-285. Saquib, Mohammed and Kaushik, Atul (2001) “Exporting Environment Friendly Products: Scope for Organic Farming in India” RGICS Working Paper Series No. 21, Rajiv Gandhi Institute for Contemporary Studies, New Delhi. Sawhney, Aparna and Chanda, Rupa (May 2003) “Trade in Environmental Services: Opportunities and Constraints” Working Paper No. 102, Indian Council for Research on International Economic Relations (ICRIER), New Delhi. Sawhney, Aparna (1999) ―GATT/WTO and Environmental Provisions‖, in Bhattacharyya, B., Seattle and Beyond: The Unfinished Agenda, New Delhi: Indian Institute of Foreign Trade (IIFT). Sawhney, Aparna (2002) “Greening Indian Business for the World Market” Working Paper No. 181, Indian Institute of Management, Bangalore. Sawhney, Aparna (16 May 2003) “Liberalization of Environmental Services”, for ―Seminar on Trade Liberalization in Environmental Goods and Services‖ UNCTAD, TERI and Union Ministry of Commerce and Industry, New Delhi. p. 7 Singh, Sandeep (2004a) “Trade Preferences and Growth of Environmental Industry: Issues and Implications for India” Working Paper, Tata Energy Research Institute, New Delhi. www.teriin.org/discussion/environ/trade.pdf 52
  56. 56. Singh, Sandeep (2004b) ―Trade Preferences and Growth of Environmental Industry: Issues and Implications for India‖, Indian Journal of Economics & Business 3(2): 289313. Suathan, Mahesh (11 October 2004) ―International Centre for Trade and Sustainable Development (ICTSD), ―Environmental Goods and Services Negotiations: Challenges and Opportunities‖ Presentation in ―WTO Workshop on Environmental Goods: Para 31 (iii) of the DDA‖, Geneva UNCTAD 2003, Environmental Goods and Services: Challenges and Opportunities for Central American and Caribbean Countries. Geneva : UNCTAD. Veena, Jha (2003) ―Trade and Environment: Doha and Beyond‖, Mattoo, Aaditya and Stem, Robert M. ed., India and the WTO, Washington DC., World Bank, pp. 299-325. Internet Sites Chaturvedi, A.K. (Director) EQMS INDIA (P) LTD, Trade and Liberalisation of Environmental Goods and Services: India‟s Opportunities and Constraints available at http://www.teriin.org/events/docs/envgoods/env2.pdf Chaytor, Beatrice, A Primer on Environmental Goods and Services: Definitional Challenges to the Negotiation of Further Liberalisation, available at http://www.field.org.uk/PDF/RSPB.pdf Definition of Khadi, available at http://www.thefreedictionary.com/khadi Environmental Goods: A Comparison of the APEC and OECD Lists, Joint Working Party on Trade and Environment, Organisation for Economic Co-operation and Development (OECD), Environment Directorate Trade Directorate, COM/ENV/TD(2003)/10/FINAL, France, 2003, available at http://www.olis.oecd.org/olis/2003doc.nsf Environmental Services, Council for Trade in Services, S/C/W/46, 6 July 1998, available at http://www.wto.org Environmental Disputes in GATT/WTO, World Trade Organization, available at http://www.wto.org/english/tratop_e/envir_e/edis00_e.htm Environmental Goods and Services in Trade and Sustainable Development, UNCTAD TD/B/COM.1/EM.21/2, United Nations Conference on Trade and Development, 5 May 2003, available at http://www.unctad.org/en/docs//c1em21d2_en.pdf Environmentally Preferable Goods and Services, UNCTAD, http://www.unep-unctad.org/cbtf/cbtf2/meetings/jamaica/unctad1.pdf available Information on Khadi, available at http://www.kvic.org.in/v4/KHADI1.ASP 53 at
  57. 57. Joshi, Manoj, Trade Liberalization in Environmental Goods: Indian Perspective, available at http://r0.unctad.org/trade_env/test1/meetings/egs/PPT-INDIA-JOSHIExpert%20Meeting%20UNCTAD%20EGS_26-06-03.pdf Liberalisation in Environmental Goods, http://www.teriin.org/events/docs/envgoods/env11.pdf TERI, available at Relationship Between Specific Trade Obligations Set Out in MEAS and WTO Rules. TN/TE/W/23. World Trade Organization. February 20, 2003 available at http://www.wto.org Robert Hamwey and others (2003) Sub-Regional Brainstorming Workshop on the Trade and Environment Issues Contained in Paragraph 31 and 32 of the WTO Doha Ministerial Declaration, Background Paper on Liberalization of International Trade in Environmental Goods and Services, UNCTAD. Bangkok available at http://r0.unctad.org/trade_env/test1/meetings/bangkok4/EGS.pdf Statement by China on Environmental Goods a the CTSS Meeting of 22 June 2004, TN/TE/W/42, 6 July 2004, available at http://www.wto.org Trade and Environment (pars 31-33) available at http://www.wto.org/english/thewto_e/whatis_e/tif_e/doha1_doha/_e.htm UNCTAD/PRESS/PR/2005/010 - 15/02/05 Database ―India‘s Exports & Imports of Environmental Goods as per APEC List‖, ITC, CMIE Database. 54
  58. 58. Annex 1. Trade balance of Indian Environmental Goods as per APEC List Commodity Code 460120 560314 591190 690210 690220 690290 690310 690320 690390 690919 Export Import Export Import Export Import Export Rs.Lakh Annual Dec-03 val 1601.41 13.4 165.08 832.7 266.56 4398.77 1634.77 Import 7652.01 Export 5161.49 Import 541 Export Import Export 784.21 5859.86 1140.93 Import 193.49 Export 986.64 Import 1777.9 Export Import Export Import 2772.16 3015.73 203.7 990.4 Commodity Name Mats, matting and screens of vegetable materials Man-Made Filmnt Wghng >150G/Sqm Other(textile products and articles) Refractory bricks, blocks, tiles and similar goods containing by weight, singly or together, more than 50% of the elements magnesium, calcium or chromium, expressed as magnesium oxide, calcium oxide oUNIT Refractory bricks, blocks, tiles and similar goods containing by weight, more than 50% of alumina (al2o3), of silica (sio2) or of a mixture of compound of these products. Other refractory bricks, blocks, tiles etc. Other refractory ceramic goods containing by weight more than 50% of graphite or other forms of carbon or of a mixture of these products. Other refractory ceramic goods containing by weight more than 50 % of alumina (aluminium oxide) or of a mixture or compound of alumina and of silica (silicon dioxide) Other refractory ceramic goods Other ceramic wares for laboratory etc. 55 Trade Balance (in Rs lakh) in 2003 1588.01 -667.62 -4132.21 -6017.24 4620.49 -5075.65 947.44 -791.26 -243.57 -786.7
  59. 59. 701710 701720 701790 840410 840420 840510 840991 840999 841011 841012 Laboratory glasses etc of fused quartz or other fused Laboratory hygienic/pharmaceutical glassware of other glass having a linear coeffcient of expansion not exceeding 5X10 -6/ Kelvin within a temperature between 0 degree C to 300 degree C. Other laboratory, hygienic/pharmaceutical glassware Auxlry Plnt Usd with Boilrs of 8402/8403 Condensers for Steam/other Vpr Powr Units Produced gas or water gas generators with or without their purifiers acetylene gas generators and similar water process gas generators with or without their purifiers Suitable for use solely or principally with spark-ignition internal combustion piston engines. Other(parts suitable for engines) Hydraulic Turbines & Water Wheels of a Power not Exceeding 1000 Kw Of a power not exceeding 1,000 kW but not exceeding 10,000 kW Of a power exceeding 10,000 kW 841090 Parts of Hydrlic Turbnes incl. Regulators Other rotary positive displacement pumps 841370 34.86 -35.01 Import Export 69.87 3.73 -211.11 Import 214.84 Export 3075.15 Import 1096.63 Export Import Export Import Export 2083.83 365.02 249.74 804.71 533.25 Import 966.65 Export 25206.44 Import Export Import Export Import 18328.95 38412.71 43441.72 221.63 Export 50.34 50.34 1978.52 1718.81 -554.97 -433.4 6877.49 -5029.01 221.63 Other centrifugal pumps 56 Import Export Import Export Import Export 20.95 20.95 606.94 1248.77 878.19 -641.83 -1006.27 Import Export 1884.46 13830.45 6286.27 Import 841013 841360 Export 7544.18
  60. 60. 841381 841410 Pumps Export 1646.12 -13080.31 Vacuum Pumps Import Export 14726.43 545.12 -2738.67 3283.79 1104.89 5321.63 3623.35 19245.52 261.6 2646.11 512.42 1736.29 188.16 399.6 411.89 841459 Other(air or vacuum pumps) 841480 Other(air or vacuum pumps) 841780 Other Furnaces & Ovens 841790 Parts of Non Electric Furnaces Ovens etc Instantaneous or storage water heaters, non-electric - Other Distilling or rectifying plant Import Export Import Export Import Export Import Export Import Export Import Export 841950 Heat exchange units Import Export 10617.78 1521.91 -2073.19 841960 Machinery for Liquefying Air/other Gases Import Export 3595.1 335.67 -1205.17 Import Export Import Export 1540.84 2527.8 2712.42 1513.42 Import 1759.26 Export 835.7 Import Export Import Export Import Export Import Export Import Export 5997.43 480.36 6859.6 678.5 1335.77 3847.08 16035.41 664.88 543.84 1.35 Import 476.34 Export Import 566.03 53.16 841919 841940 842119 Centrifuges, incl. centrifugal dryers, Other 842121 Centrifuges, incl. centrifugal dryers, for filtering or purifying water Centrifuges, incl. centrifugal dryers, other 842129 842139 Filtering or purifying machinery and app. for gases, other 842191 Parts, of centrifuges, incl. centrifugal dryers. 842199 Parts, other 842220 Machinery for Clng/Dryng Botls/other Cntnrs Other Continuous Action Elevatrs & Conveyrsfor Goods/Materials,Belt Type Other machinery 842833 843680 57 -4216.74 -15622.17 -2384.51 -1223.87 -211.44 -10205.89 -184.62 -245.84 -5161.73 -6379.24 -657.27 -12188.33 121.04 -474.99 512.87
  61. 61. 846291 Hydraulic presses 847290 Other office machines 847410 Sorting, screening, separating or washing machines 847432 Mchns for Mxng Mnrl Substncs with Bitumen Mxng, Kneadng, Crushng, Grndng, Screng, Siftng, Homogensng, Emulsifyng/ Stirrng Mchns Other ( machines or mechanical appliances) 847982 847989 847990 Parts 850231 Other generating sets; wind powered Electro magnets; chucks, clamps & similar devices 850590 851410 851420 851430 851490 Resistance heated furnaces & ovens Induction/dielectric furnaces & ovens Other furnaces and ovens 854389 Parts of articles of industrial or laboratory electric (including induction or dielectric) furnaces and ovens; other industrial or labortatory induction or dielectric heating equipment Photosensitive semi-conductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light emitting diodes Other nes 890710 Invlatable Rafts 890790 Other floating structures 854140 58 Export Import Export Import Export Import Export Import Export 1156.19 2244.49 2008.91 18779.03 294.93 1950.37 64.47 7425.51 1149 Import 3416.35 Export 19150.42 Import Export Import Export Import Export 56677.1 31927.81 19478.62 143.55 638.94 1807.06 Import Export Import Export Import Export Import Export 3542.95 91.11 270.21 378.35 96.32 870.62 1088.59 577.53 Import 1321.75 Export 33239.71 Import 6901.62 Export Import Export Import Export 2762.48 37655.28 40.96 157.92 24.35 -1088.3 -16770.12 -1655.44 -7361.04 -2267.35 -37526.68 12449.19 -495.39 -1735.89 -179.1 282.03 -217.97 -744.22 26338.09 -34892.8 -116.96 -199.17
  62. 62. 901540 Photogrmtrcl Survying Instrmnts & Applncs 901580 Othe instruments and appliances. 901590 Parts & Accessores of Surveying,Phtogrmcl,Hydrogrphic Instrumnts etc. excl. Compasses Apprts Bsd On Use of Alpha,Bta/Gma Radtns for other Usesincl Rdogrphy & Rdothrpy Apprts Other, including parts and accessories. Liquid-filled, for direct reading. 902229 902290 902511 902519 Other ( hydrometers and similar loating instruments) 902580 Other instruments 902590 Parts & Accssrs of Instruments of Hdg 9025 For measuring or checking the flow or level of liquids. 902610 902620 902680 902690 For measuring or checking pressure. Other instruments or apparatus. Parts&Accssrs of Insrmnts/Apprts of Hdg9026 902710 gas or smoke analysis apparatus. 902720 Chromatographs & Electrophoresis Instrmnt 902730 Spectrometers, spectrophotometers and spectographs using optical radiations (UV, visible, IR) Exposure Meters 902740 902750 Other instruments and apparatus using optical radiations (UV, 59 Import Export 223.52 Import Export Import Export 405.9 794.42 10001.17 1142.41 Import 2335.34 Export 199.58 Import 1349.44 Export Import Export Import Export Import Export Import Export Import Export Import Export Import Export Import Export 12608.93 20419.72 273.56 275.4 134.02 945.53 44.4 1262.82 209.51 1530.74 2674.17 6732.81 1211.68 5703.77 208.93 4376.84 712.36 Import Export Import Export Import 6795.59 643.21 5374.85 24.13 12687.83 Export 118.69 Import 13320.66 Export Import Export Import -405.9 -9206.75 -1192.93 -1149.86 -7810.79 -1.84 -811.51 -1218.42 -1321.23 -4058.64 -4492.09 -4167.91 -6083.23 -4731.64 -12663.7 -13201.97 -9.43 9.43 178.77 2312.41 -2133.64
  63. 63. 902780 902790 visible, IR) Other instruments and apparatus. 902810 Microtomes; parts and accessories. Gas Meters 902820 Liquid Meters 902830 Electricity Meters 902890 Parts and Accessories of Gas Lqd or Electricty Supply or Production Meters Instrument and Apparatus for Measuring or Detecting Ionising Radiation Cathode-ray oscilloscopes and cathode-ray oscillographs. Multimeters 90301000 903020 903031 903039 903083 903089 903090 903110 Other ( oscilloscopes and other instruments for measuring or checking electrical quantities excluding meters) Other with a recording device, nes Other ( oscilloscopes and other instruments for measuring or checking electrical quantities excluding meters) Parts and accessories. 903120 Machines for Balancing Mechanical Parts Test Benches 903130 Profile Projectors 903180 Other Msrng&Checking Instrmnts,Applncs&Mchns 903190 Parts and Accessories of Instrmnts of 9031 60 Export 523.94 -28704.57 Import Export Import Export Import Export Import Export Import Export 29228.51 315.46 14552.87 567.35 424.65 23.46 157.4 2171.73 9848.33 185 Import 3469.77 Export Import 544.85 1022.54 -477.69 Export Import Export Import Export 27.95 2113.96 127.82 765.12 5681.63 -2086.01 Import 6520.7 Export Import Export Import 26.97 934.77 107.46 6068.37 Export Import Export Import Export Import Export Import Export 1340.63 5659.94 157.59 844.67 165.23 2207.26 17.27 2333.24 615.76 Import Export Import 49306.94 749.43 15481.58 -14237.41 142.7 -133.94 -7676.6 -3284.77 -637.3 -839.07 -907.8 -5960.91 -4319.31 -687.08 -2042.03 -2315.97 -48691.18 -14732.15
  64. 64. 903210 Thermostats Export 277.75 -1739.97 Manostats Import Export 2017.72 0.11 -180.55 Hydraulic/Pneumatic Instrumnts & Apparatus Other ( automatic regulating or controlling instruments) Import Export Import Export Import 180.66 344.05 309.78 2710.31 21137.08 Export 559.56 -12111.25 Import Export 12670.81 9971.28 -28605.07 Import 38576.35 Export 265270.22 Import 683669.22 Export Import 25513727.71 29720587.48 903220 903281 903289 903290 9033 Parts and Accessories of Instrmnts of 9032 Parts and accessories (not specified or included elsewhere in this Chapter) for machines, appliances, instruments or apparatus of Chapter 90. Subtotal of Exports of environmental goods Subtotal of Imports of environmental goods Total Export of India Total Import of India 34.27 -18426.77 -418399 -4206859.77 Trade Balance calculated on the basis of data extracted from Indiatrades Annex 1A. Share of Export and Import of Indian Environmental Goods as per APEC List Subtotal of Exports of Environmental Goods Percentage in Total Export Subtotal of Imports of Environmental Goods Percentage in Total Import Rs.Lakh Annual Dec-99 val 106309.15 Rs.Lakh Annual Dec-00 val 122241.93 Rs.Lakh Annual Dec-01 val 179428.21 Rs.Lakh Annual Dec-02 val 211944.11 Rs.Lakh Annual Dec-03 val 265270.22 0.01 0.01 0.01 0.01 0.01 455218.25 453225.83 489700.14 534806.43 683669.22 0.03 0.02 0.02 0.02 0.02 61