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India ratifies TIR Convention to access transnational multi-modal connectivity

Livemint:  June 20, 2017

New Delhi: India ratified the Transports Internationaux Routiers or International Road Transports (TIR) Convention, IRU, the global road transport organization said in a statement on Monday.

The multilateral international transit treaty—Customs Convention on International Transport of Goods under cover of TIR Carnets—is also referred to as the TIR Convention and functions under the auspices of the United Nations Economic Commission for Europe (UNECE).

It will help India access transnational multi-modal connectivity and play an important role in the proposed transportation architecture in the region and beyond in the backdrop of India recently ratifying the trade facilitation agreement (TFA) of the World Trade Organization (WTO).

TIR will help facilitate India’s trade with its eastern and western neighbours and comes against the backdrop of China’s ambitious “One Belt One Road” initiative aimed at connecting some 60 countries across Asia, Africa and Europe to boost trade and economic ties on the lines of the traditional maritime route.

“TIR will enter into force in India six months after the date of accession. During this period some legal, technical and training steps are required to make TIR operational. IRU which has been mandated by UN to manage the TIR system will work closely with all relevant stakeholders in India to prepare the country for implementation of the convention by that time,” Umberto de Pretto, IRU secretary general said in an interview.

India became the 71st signatory to this international transit system, designed to facilitate the seamless movement of goods throughout these countries in Asia and Europe. Interestingly, the two countries which signed TIR before India were Pakistan (2015) and China (2016).

“On the eastern front, it will help India to integrate with Myanmar and Thailand as well as Bangladesh, Bhutan and Nepal. On the western front, it will enable India to move cargo along the International North-South Transport Corridor via Chabahar port in Iran, to access landlocked Afghanistan and the energy-rich Eurasian region,” the statement said.

The Union cabinet in March approved the signing of the TIR Convention by the Indian government.

The Chabahar port in Iran being developed by India is expected to play an important role in this evolving transportation stratagem. The port is located in the Gulf of Oman, near Iran’s border with Pakistan and will allow India access to landlocked Afghanistan and energy-rich Central Asia through the Jawaharlal Nehru and Kandla ports on India’s west coast.

“The TIR system secures customs duties and taxes and provides a robust guarantee mechanism, thereby reducing trade transaction costs, and facilitating higher growth of intra-regional and inter-regional trade,” the statement added.

TIR will also help India move goods along the International North-South Transport Corridor (INSTC)—an ambitious multi-modal transportation project established in 2000 by Iran, Russia and India to promote transportation cooperation. INSTC is to connect the India Ocean and Persian Gulf to the Caspian Sea through Iran and then onwards to St. Petersburg and northern Europe through Russia.

“India’s decision to implement the TIR system will have far reaching benefits for trade and will save significant time and money by streamlining procedures at borders, reducing administration and cutting border waiting times,” added Boris Blanche, chief operations officer at IRU.

India has been putting in place the building blocks for its transnational multi-modal connectivity plan. This includes a proposed passenger ferry service to Bangladesh, a plan to operationalize the Trans-Asian Railway (TAR) route of Dhaka-Kolkata-Delhi-Amritsar-Lahore-Islamabad-Zahedaan-Tehran-Istanbul, India-Myanmar-Thailand Trilateral Highway project, as well as the Bangladesh-Bhutan-India-Nepal (BBIN) Motor Vehicles Agreement.

“To further promote connectivity, trade and regional integration, India needs to cooperate with neighbouring countries such as Bangladesh, Bhutan and Nepal to make the BBIN Motor Vehicle Agreement operational in particular benefitting from TIR transit system. India needs also to cooperate with Myanmar and Thailand and the whole BIMSTEC region on regional integration and connectivity and link South to South East Asia,” added Umberto de Pretto.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.