B.E. Assessment

European Commission-funded SPS Measures project paper on the effect of sanitary and phyto-sanitary regulations on Indian exports, 2004

    Description
    The SPS Measures project is funded by the European Commission and exists to study the impact of sanitary and phyto-sanitary (SPS) measures on Indian agricultural exports. In the paper 'SPS regulations and developing country exports,' authors Amir Ullah Khan and Mohammed Saqib argue that SPS measures are not explicit trade barriers but through misuse often function as implicit trade barriers by raising obstacles and offering protection to domestic producers. There is growing concern that some SPS measures currently applied to India and elsewhere may be inconsistent with World Trade Organization (WTO) provisions and may unfairly impede the flow of agricultural trade. But the Indian government is not well positioned to respond because the lack of reliable data and complexity of the issue makes it difficult to define the nature and scope of the problem. SPS Measures hopes to close this information gap by studying current food safety and SPS regulations, and preparing a comprehensive text on existing standards in India. This paper represents a step towards this goal. It details the history, intent, and requirements of the current SPS Agreement, considers the cost of compliance, and examines the effect of current SPS measures on a variety of Indian agricultural exports including marine products, peanuts, mango, and poultry.

    Summary of results
    The authors conclude that Indian agricultural processors, particularly SMEs, need capacity support from the Indian Government and industry associations in order to survive the SPS requirements. It may also be necessary to request subsidies or trade-related investment measures (TRIMS), multilateral assistance, and international cooperation. The appropriateness of standards to local conditions should be assessed, the risk of non-fulfillment should be analyzed, and equivalence could be considered where harmonization is not attainable.