Millennium Post

Following up on reforms, govt to set up panel on internal trade

A high-level panel, headed by consumer affairs minister K V Thomas, will be constituted by the end of this month to look into internal trade issues that may arise following FDI in multi-brand retail.

Last month, the cabinet gave green signal to 51 per cent foreign direct investment in multi-brand retail. It had also asked to set up a high-level committee under chairmanship of the consumer affairs minister to recommend on internal trade reforms to the government.

'We will set up a high-powered committee on internal trade reforms at the earliest by month-end. We are working out the modalities, including the terms of reference,' Thomas told reporters at Assocham seminar on inter-state trade barriers.

The committee will interact with state governments and traders to find out their difficulties following FDI in multi- brand retail and come out with solutions, he said.

'The government is open to address all issues facing small traders. We will consult all stakeholders once the committee starts its operations,' the minister said.

In his inaugural address, Thomas said that trade barriers between different states are 'quite a complex issue and need to be tackled in a systematic manner that would offer permanent solutions.'

He also mentioned that the government has been taking initiatives in agriculture to ensure smooth trade between different states.

For instance, most states have amended their APMC Act, that aims to provide setting up of private market yards besides promoting public private partnership in management and development of farm markets, he said.

The minister also said that agriculture ministry is formulating a bill for smooth inter-state trade of agricultural commodities.

Thomas also released the Assocham study, which observed that the existing complex and multi-layered indirect tax structure has fragmented Indian market into 28 state markets by tax barriers which adversely affect competitiveness.

The study suggested setting up of a national level single market by removing all barriers to trade, multiple acts, fiscal policies and marketing arrangements across the country.

That apart, it emphasised the need for improvement in the tax structure and tax administration. It also suggested the review of existing policies and regulations both by the centre and state governments from the competition perspective.    
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