CHANDIGARH: The revival of the historic India-China border trade through the Shipki La Pass in Himachal Pradesh has hit a roadblock again, days after it resumed following a six-year gap, with traders suspending operations in protest against the levy of Integrated Goods and Services Tax (IGST).
The trade through the 13,000-foot-high Shipki La Pass in Kinnaur resumed on August 1. However, after the first batch of 16 traders returned from the Tibet Autonomous Region of China, the Kinnaur Indo-China Trade Association decided to suspend the trade, saying the IGST had made it commercially unviable.
Chief Minister Sukhvinder Singh Sukhu will raise the issue with Union Finance Minister Nirmala Sitharaman on September 7. Following an assurance from the state government, traders also decided to suspend their proposed fast till September 7.
The association, representing registered border traders from Shipki La, held an emergency meeting after receiving communication from the Customs Department regarding the IGST levy on goods imported through the border trade route.
The association said customs duty had been exempted under Government of India Notification No. 38/96-Customs, dated July 23, 1996, to encourage traditional border trade, but the IGST had substantially increased the financial burden on traders.
Kinnaur Indo-China Trade Association president Hishey Negi said the association had unanimously decided to suspend trade until the IGST on items approved for the Shipki La route was exempted in line with the customs duty exemption.
“Due to the limited value of trade, difficult terrain, transportation by mules an, short trading season the levy of IGST makes the trade commercially unviable,” he said.
Negi said the trade was conducted through the barter system between India and China and the additional tax burden would affect its overall volume and the economic viability of traders.
“The association remains hopeful that the ongoing dialogue and the state government’s intervention will lead to a fair, practical and lasting resolution of the issues affecting the Shipki La border trade. As we have been assured that the matter will be taken up with Union Finance Minister Nirmala Sitharaman when Chief Minister Sukhvinder Singh Sukhu meets her on September 7 and will seek a favourable and appropriate resolution of the matter to provide relief to the traders,” he said.
He added that the association would decide its further course of action after the September 7 discussions.
The association has also asked the state government to take up issues related to quarantine facilities, road connectivity between border trade centres and updating the Trade Import-Export List.
The issues concerning the traditional Shipki La trade were also discussed at a meeting in Shimla. Principal Adviser to the Chief Minister Ram Subhag Singh, Kinnaur Deputy Commissioner and Trade Commissioner, state government officials, Customs and ITBP officials, and Negi attended the meeting.