European Parliament 2014-2019

Committee on the Internal Market and Consumer Protection

22.3.2017

NOTICE TO MEMBERS

(0001/2017)

Subject: Report on the IMCO delegation visit to India on 21 – 23 February 2017

Introduction

A delegation of the Internal Market and Consumer Protection Committee (IMCO) visited India (Mumbai and New Delhi) between 21 and 23 February 2017. The mission underlined the importance of the EU-India strategic partnership and covered regulatory issues in areas such as services, standardisation, customs and consumer protection. Members were particularly interested in: the Indian customs’ priorities (including the management of port controls and relevant customs IT systems); in developing a better understanding of how India ensures safe products, combats counterfeiting, safeguards consumer rights, cracks down on anti-competitive behaviour and reduces administrative burden sharing; in cooperation on standardisation between India and the EU.

In particular, in Mumbai and New Delhi the delegation met: .the Minister for Skill Development and Entrepreneurship, .the Minister of Consumer Affairs, .the Minister of for Information Technology, .the Chairmen of the Indian parliamentary committees on Information Technology and on Consumer Affairs, .the Governor of Maharashtra, .Mumbai customs authorities, .the EU Ambassador to India, .the EU Member States Counsellors and representatives of the EU business, .the Director of the Council of EU Chambers of Commerce of India, .the Director of the Seconded Expert Standardisation Expert in India (SESEI), .representatives of the Consumer Guidance Society of India (CGSI),

CM\1119991EN.docx PE601.155v01-00

EN United in diversity EN .representatives of NASSCOM and Mastek, start-up incubators.

Led by the IMCO Chairman, Vicky Ford (ECR, UK), the delegation was composed of Andreas Schwab (EPP, DE), Ivan Stefanec (EPP, SK), Evelyne Gebhardt (S&D, DE), Olga Sehnalova (S&D, CZ) and Marlene Mizzi (S&D, MT).

Summary report

Tuesday, 21 February 2017 (Mumbai)

(1) The delegation visit started in the morning of Tuesday, 21 February with a meeting with the Mumbai Customs authorities. The Chief Commissioner of Customs, Zone I, Rajeev Tandon, explained that Mumbai Customs consists of Zone I (Mumbai port), Zone II (Jawaharlal Nehru Custom House (JNCH)) and Zone III (Air Cargo and Airport). The delegation learnt that Mumbai Customs is the biggest Customs department in India and that the EU is India’s number one trading partner with 13% of India’s overall trade with the world in 2014-15, well ahead of China (with 9,5%) and USA (with 8,5%). Germany, Belgium, France and Italy are India’s top 25 trade partners while India is the EU’s 9th trading partner (with 2,2% of EU’s overall trade with the world).

Exchanges with the Principal Commissioner of Customs, Bani Bhattacharya, focused on the key elements of the customs’ modernisation in India: .the move from physical control to self-assessment; .the shift from manual processing to online EDI system (e-filing and e-payment) and since 2016 from 9 separate forms to one integrated declaration (“SWIFT”); .the adoption of digital signature for importers, exporters, airlines and shipping lines; .the adoption of Service Quality Management Standards; .a tax payer service centre, and .an e-helpline (online facility for clarifying doubts of trade agents and industry operators).

Members were particularly interested in knowing about how digital customs works in practice in India. Emphasis was placed on the role of “ICEGATE”, a portal that provides e-filing services to the trade and cargo carriers who can avail facilities of self e-filing documents, e- payments, real time tacking and checking query status. In 1995 India also introduced the Customs EDI System (ICES) which computerises customs related functions including import/export, general manifest and ex-bond clearance of warehoused goods. This system serves to respond more quickly to the needs of trade agents, to reduce interaction between them and government agencies and to improve transparency and accountability. Members also inquired about how international standards and consumer protection are enforced and what is put in place to combat counterfeit.

(2) The delegation had then an overview of the infrastructure of the three terminals of Mumbai’s port, followed by a meeting with the Chief Commissioner of Customs, Zone II, Dr. John Joseph. Mumbai Customs Zone-II is the biggest Customs Zone in the country in terms of revenue collection and contributes about 24% of the National Customs Revenue and about 4.6% of the total revenue receipt of the Central Government of India. It is also the biggest in terms of import and export cargo handled in containers.

PE601.155v01-00 2/9 CM\1119991EN.docx EN Exchanges with customs officers focused on the measures taken to facilitate top importers/commodities/manufacturers to promote “Make in India -green corridor” ensuring free clearance and move towards cashless and paperless customs. The digitalisation of the entire cargo clearance system was also the subject of discussion (enhanced levels of advance filing of bills of entry prior to the arrival of vessels, take-up pre-arrival risk processing, enhanced facilitation levels by straightening risk management and onsite post clearance audit, real time seamless online exchange of information). The development of professionalism and responsibility amongst customs officers was also of high interest to Members who learnt about the role of the NACEN (National Academy of Customs Excise & Narcotics) e-learning trainings for customs officers in the field of Customs, Central Excise, Service Tax, Drug Laws, Anti-Money laundering, Weapons of Mass Destruction, Fake Indian Currency Notes, Ozone Depleting Substance (ODS), IPRs etc. Further inquiries by Members covered the management of port controls, customs enforcement of Intellectually Property rights (IPRs), combating counterfeit and conformity to service delivery standards.

(3) Meeting with EU Trade Counsellors and representatives of the EU businesses. The Director of the Council of EU Chambers of Commerce in India, Renu Shome, explained that since its set up in 1992, the Chamber has become an important platform of 800 members for both EU and India with the purpose to promote two-way flows in trade and investment, interact and explore possibilities of exports, imports, joint ventures, distribution partners, technology exchange and trade dialogue. The Trade and Economic section of the EU Delegation to India keeps regular contacts with the EU Trade Counsellors and meets them in Mumbai twice per year for an update on the main economic policy developments. The EU Member States with an active consulate are mainly Belgium, France, Germany, Hungary, Italy, the Netherlands, Poland, Spain, and the United Kingdom. The EU trade counsellors stressed the importance of raising the profile of the EU in India through such EP parliamentary committee visits. The main areas of interest for the European business (i.e. agriculture, water and environment) and the need to improve Indian capability in sectors like food (production of machinery, denomination of origin, etc) were also discussed. Members inquired about: the ways to promote EU in the different Indian states; how EU countries without representation in India could benefit from EU visibility; the barriers for EU business to settle in India, the ways to develop skills and a single market which serves both business and consumers.

(4) At the bilateral meeting with the Governor of the State of Maharashtra, C. Vidyasagar Rao, Members exchanged views on current local political developments and challenges for the Maharashtra State (including cleanliness and environmental protection). “Clean India” was mentioned as Indian project where European companies could offer expertise. Members learnt that Maharashtra is the wealthiest and one of the most developed states in India, contributing 25% of the country's industrial output. It has over 112 million inhabitants and its capital, Mumbai, has a population of approximately 18 million. The state has a large, multi- modal transportation system with the largest road network in India. Members inquired about women in business, gender balance in higher education, equivalence of curricula amongst the Indian states. They learnt that Maharashtra schools are run by the state government or by private organisations, including religious institutions and that Maharashtra has 24 universities with a turnout of 160,000 graduates every year. The ongoing trade agreement negotiations

CM\1119991EN.docx 3/9 PE601.155v01-00 EN between India and EU were also discussed. The main message from the Governor to the EU was: “Come to invest here, there is manpower and skills”.

(5) At the informal reception organised by András Halász, Hungarian Commercial Counsellor, in his private house, no extensive presentation was given, however Members had the chance to liaise individually with him and the attending Belgian and German Commercial Counsellors on EU business in India.

Wednesday, 22 February 2017 (Mumbai)

(6) Members visited the Consumer Guidance Society (CGSI), and held a vivid exchange with Prof. N.M. Rajadhyaksha, CGSI Chairman, on safe products, consumers’ rights, ways to empower consumers and offer them guidance on how to obtain redress in India. Prof. Rajadhyaksha explained that the CGSI is the oldest consumers’ association in the country and was founded in1966. The Maharashtra State Government has entrusted CGSI to establish and manage the Maharashtra State Consumer Helpline. This helpline is managed by volunteers and helps in redressing around 80% of complains. Members learnt that CGSI was instrumental in the approval and implementation of the Consumer protection Act in 1986. Among its activities, CGSI deals with: complaint resolution, production testing, promotion of consumer awareness, training projects in rural areas, representation of consumer interests before the Government and other bodies, participation in meeting of technical governmental bodies (e.g. the Bureau of Indian Standards, telecom Regulatory Authority of India). Members inquired about the main challenges encountered by CGSI in defending consumers’ rights, ways to redress consumers’ complains in the construction industry (housing) and services sector. Prof. Rajadhyaksha also clarified that despite the existence of special courts to redress consumers’ complaints within 90 days, in reality this takes around 4-5 years and the costs are huge. This is the reason why CGSI tries to promote and facilitate mediation amongst the parties to rapidly solve cases. Collective complaints are rather seldom in India.

(7) The delegation visited the Millennium Business Park, which was established by the Maharashtra Industrial Development Corporation (MIDC), a State Government body empowered to make links between government and private investment by carrying out acquisition of land and provision of infrastructure facilities and services. This Park is spread over 50 Acres and was completed in 2001. It hosts about 280 IT companies, the most relevant being Reliance Infocomm, Hexaware Technologies, Tata Consultancy Services, Rupa Infotech, Allied Digital Services. Those companies employ around 12,000 IT engineers and export goods and services worth more than EUR 150 million per year.

(8) The visit to NASSCOM, a start-up warehouse that provides infrastructural support for start-ups in the IT sector, followed the presentation of MIDC. NASSCOM offers start-ups a central, plug-and-play working space for the first six months of their operations. Their goal is “To help the IT and IT enabled products and services industry in India to be a trustworthy, respected, innovative and society friendly industry in the world”. According to NASSCOM

PE601.155v01-00 4/9 CM\1119991EN.docx EN representatives the programme, which started in 2013, has helped more than 2,000 start-ups. Members inquired about the latest innovations developed by start-ups and the level of participation of women in the IT-business.

(9) During the visit to Mastek, the delegation learnt about this IT-company specialised in building digital solutions for clients in Government, Health, Retail, and, Financial Services. Members were told that Mastek has created dedicated Centres of Excellence focussed on enhancing expertise in Agile Applications Development, Next Generation Service Management, Enterprise Testing, Data Warehousing, Business Intelligence, Analytics, Enterprise Mobility, Digitalisation, Legacy Rejuvenation and Modernisation. Members were particularly interested in knowing about ways to unlock the potential of the digital market and services.

Thursday, 23 February 2017 (New Delhi)

(10) The exchange of views with Dinesh Sharma, the Director of the SESEI (Seconded European Standardization Expert in India), project, which has the ambition to facilitate EU-India cooperation in standardisation matters, as well as to support Regulatory Dialogue activities involving the European Commission and the Indian Government. The project brings together five main partners: European Committee for Standardization (CEN); European Committee for Electrotechnical Standardization CENELEC); European Telecommunications Standards Institute (ETSI); DG GROW: and European Free Trade Association (EFTA). The project, inter alia, facilitates cooperation between Indian and European standardisation bodies as well as European companies facing standardization related issues hampering market access to India. The project also supports India in standardization related aspects in the WTO trading system, by identifying all potential opportunities for enhanced international cooperation and global harmonisation of standards. The SESEI project has also the objective to reduce the technical Barriers to Trade (TBT) between EU and India and globally. Members inquired about the priority areas of the SESEI project which include: information and communication technology, electrical and electronic household products, automotive (connected cars) and smart cities.

(11) During their meeting with EU Ambassador, Tomasz Kozlowski, Members exchanged on the relations between India and EU, its challenges and opportunities. India is one of the EU's strategic partners and its relations cover a wide range of issues, in the political, economic and social spheres. The EU is the first trading and investment partner of India. Two-way trade in goods between the EU and India reached EUR 77.3 billion in 2015, or EUR 211 million per day. In addition to being the main destination for Indian outward Foreign Direct Investment (FDI), the EU is also India's most important source of inward FDI with almost EUR 5 billion of EU outward investment to India in 2014. The EU and India hope to increase their trade in both goods and services - as well as investment - through the negotiations for a free trade agreement (better known as Broad-based Trade and Investment Agreement – BTIA) that was launched already in 2007. The 13th EU-India Summit was held in March 2016 in Brussels and approved several Joint Declarations, including in the areas of

CM\1119991EN.docx 5/9 PE601.155v01-00 EN Water and Clean Energy and Climate Change. Members inquired on the development of an EU-India Start-Up Network and a Joint Declaration in 5G technology between the EU and India that should promote innovators and job-creators.

(12) At the meeting with the Indian parliamentary committee on Information Technology, chaired by Anurag Singh Thakur, Members exchanged views on how to enhance the collaboration between India and EU in the IT sector and how to promote a Digital Single Market in India. The delegation also inquired about the access to internet for all, skill development in the IT sector, how to protect citizens and business from cyber threats and promote cyber security.

(13) At the meeting with the Indian parliamentary committee on Food, Consumers Affairs and Public Distribution, chaired by J.C. Divagar Reddy, Members exchanged on the availability of essential commodities and safe products. The delegation also inquired about how to promote consumer protection especially in the phone industry and in construction where consumers seem to have major concerns. Other subjects of discussion were effective redressal mechanisms and e-filing of complaints in consumer courts. While speaking about standards in the context of fast industrialisation and globalisation, speakers mentioned the recent Bureau Indian Standards (BIS) Bill for simpler self-certification mechanism, enabling provision for mandatory hallmarking, product recall and product liability for better compliance to standards passed by Lok Sabha.

(14) The meeting with the Minister for Skills Development and Entrepreneurship, Rajiv Pratap Rudy, was the first in the series of visits to Ministries. The delegation learnt about "Skills India", a Government's initiative which empowers the youth of the country with skill to make them more employable and more productive in their work environment. Skills India offers courses across 40 sectors in the country which are aligned to the standards recognised by both, the industry and the government under the National Skills Qualification Framework.

During the meeting, it was stressed that for the first time in 68 years since India’s independence, a Ministry for Skill Development & Entrepreneurship (MSDE) has been formed to specifically focus on enhancing the employability of the youth through skills development. The skills system in India was presented as a great reform which reinvigorates and re-energises the country’s workforce; and is preparing the youth for jobs and growth opportunities in the international market. Minister Rajiv Pratap Rudy stated that "The success of a nation always depends on the success of its youth. Skill India is certain to bring a lot of advantage and opportunities for these young Indians. The time is not far when India will evolve into a skilled society where there is prosperity and dignity for all."

Members inquired about the mutual recognition of qualifications between EU and India and expressed their wish that the FTA is rapidly concluded with India. Minister Rajiv Pratap Rudy called for a renewal of the EU technical assistance programme on skills which ended in September 2016.

(15) During the meeting with the Minister for Consumer Affairs, Food and Public Distribution, Ram Vilas Paswan, Members learned that his department of consumer affairs administrates the policies for consumer cooperatives, monitoring prices, availability of

PE601.155v01-00 6/9 CM\1119991EN.docx EN essential commodities, consumers movements in the country and controlling statutory bodies such as the Bureau of Indian Standards (BIS). The present priority of the Indian government is keeping prices of all essential food items under control and full digitalisation of public distribution system. Furthermore, several initiatives have been taken to protect consumer interest including provisions to fix retail prices of essential items in order to check price increases.

Members inquired about enhancing awareness among consumers in order for them to make informed choices and facilitating timely and effective redressal through affordable mechanisms. Further exchanges focused on how to enhance consumer protection and safety through progressive legislations and prevent unfair trade practices.

On Indian standards, the Director General of the Bureau of Indian Standards (BIS), Mrs Alka Panda, indicated that BIS was established in 1986 as part of the Ministry of Consumers Affairs and has the objective to promote the development of standardisation and the quality certification of goods. Members learnt that the BIS Act of 2016 established BIS as the National Standards Body of India. It allows multiple types of conformity assessment schemes, enables the Government to bring more goods and services under compulsory certification, provides for the recall of products which do not conform to relevant Indian Standards, and strengthen penal provisions.

(16) The last in series of meetings with Ministers was with the Minister for Law and Justice & Electronics and Information Technology, Ravi Shankar Prasad. Members engaged in a vivid exchange with Minister Ravi Shankar Prasad on “Digital India”, a flagship programme promoted by the Minister that has the objective to bring about good governance by making extensive use of Information technology for all citizens. The Minister’s vision is to empower every citizen with access to digital services, knowledge and information. He stated that “IT (Indian talent) + IT (information technology) = IT (Indian technology)”. The delegation learnt that Digital India campaign has already increased the connectivity across the entire nation. India has now over 40crore (1 crore=10.000.000) Internet connections, 100 crore Mobile Phones and an equal number of land lines. 970 million people have Aadhar cards and their bio-metric information is already available. India has become the second highest user- base for Facebook, Google and other social media tools.

Members inquired on common (EU and India) risks for cybercrime and fake news that need to be addressed jointly. While speaking on e-commerce, Minister Ravi Shankar Prasad said that this has triggered the internet economy and pushed for “Banking the unbanked, funding the unfunded, and securing the unsecured”.

(17) A reception was offered by EU Ambassador, Tomasz Kozlowski, in the evening of 23 February. Members had the chance to liaise individually with the EU Ambassador and their colleagues of AFET committee who were also on mission to New Delhi on 22-23 February. Members exchanged their impressions on their visit to India and engaged in informal discussions on the potentials and challenges of the future relation between EU and India.

CM\1119991EN.docx 7/9 PE601.155v01-00 EN Annex Photos

Meeting with Mumbai Customs authorities Visit to Mumbai port

Meeting with EU business and EU Trade Counsellors Meeting with the CGSI team

Meeting with the Governor of Maharashtra

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Meeting with NASSCOM Meeting with MASTEK

Meeting with the Indian parliamentary committee on Information Meeting with the Indian parliamentary committee on Food, Technology Consumers Affairs and Public Distribution

At the Indian Parliament At the Indian Parliament At the India Gate

Meeting with Minister for Skills Development Meeting with Minister for Consumer Affairs, Meeting with Minister for Law and Justice and Entrepreneurship Food and Public Distribution & Electronics and Information Technology

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