WORLD TRADE
ORGANIZATIONWT/L/262
27 February 1998
(98-0794)
Original:  English
BHUTAN - REQUEST FOR OBSERVER STATUS
Communication from Bhutan
The following communication, dated 4 February 1998, has been received from the Minister of
Trade and Industry of Bhutan.
_______________
On behalf of the Royal Government of Bhutan, I have the honour to submit the application of
the Royal Government of Bhutan for observer st atus in the General Council of the World Trade
Organization (WTO) and its subsidiary bodies.
In this connection, I would like to state that it is the intention of the Royal Government of
Bhutan to apply for accession to the WTO Agreements in the future.  In the meantime the observer
status would help the Royal Government of Bhutan to familiarize itself with the WTO and its rules
and procedures.
I should like to request you to place this application and the accompanying document before
the General Council at its next meeting.WT/L/262
Page 2
AN OVERVIEW OF BHUTAN'S ECONOMIC POLICY AND
FOREIGN TRADE REGIME
I. INTRODUCTION
A. The Country
1. The Kingdom of Bhutan covers an approximate area of 46,500 square kilometres, roughly
150 km. north to south and 300 km. east to west.  The country is bordered by the Tibetan region ofChina and the Indian states of Arunachal Pradesh, Assam, West Bengal and Sikkim.  Bhutan is one of
the least populated countries in South Asia with most settlements in and around river valleys.  The
population is estimated at 600,000 and is expected to rise steadily given the current population growth
rate of 3.1 per cent per annum.  Measures are however being taken to promote family planning.
2. While 72 per cent of the country is covered by forests, the area suitable for mechanical large
scale agricultural production is limited, mainly due to the steep terrain, high altitudes and large
reserve forests and game sanctuaries.  However, even if more land was made available for agriculture,the small population would have few additional manpower for the labour- intensive practices
necessary.  The river valleys and the land in the southern foothills account for most of the fertile
cultivable land whereas the northern alpine belt below the snowline is suitable mostly as pasture for
animals.
3. Despite this situation, 85 per cent of the population derive their living from agriculture,
animal husbandry and other traditional activities in the rural sector.  Employment in the modern
sectors of the economy is still small, apart from public services of various kinds and in some trade and
industry.  Industrial development is also limited and does not yet provide for large scale employment.
The Government has been responsible for initially establishing several manufacturing enterprises, but
the private sector has taken over, or is in the process of taking over, these activities.  Unlike manyother developing countries, unemployment is not a pressing problem as of present but the danger
signals are beginning to emerge.
B. The Economy
4. For purposes of comparison, by the end of 1985 Bhutan had completed 24 years of planned
development.  Agriculture still dominated the economy and the vast majority of the Bhutanesedepended on agriculture and animal husbandry for their livelihood.  In 1985, agriculture contributed
54.9 per cent, and the construction sector with 11.1 per cent was the next major contributor to GDP.
Other sectors that contributed a significant share to GDP were government services, trade and allied
activities, each contributing more than 8 per cent of GDP.  Financial services contributed 7.2 per cent
to GDP.  Transport, Communication and Manufacturing sectors which were still in their nascentstages contributed only 5.2 per cent and 4.9 per cent respectively.
5. During the subsequent decade, that is, 1985-1995, the Bhutanese economy experienced a
growth rate of 6.8 per cent per annum, doubling the real GDP to Nu. 2946 m from Nu. 1510.8 m. This
was due largely to the commissioning of the 336 MW  Chukha Hydroelectric Project in 1987/88 and
its forward linkages to other sectors, particularly  power-intensive industries like calcium carbide and
ferrosilicon.
6. The savings have increased enormously from Nu. (-)4.9 m in 1985 to Nu. 2523.8 m by 1994.
This growth is attributable mainly to the privat e sector's savings.  The Government saving on the
other hand, has remained mostly negative, and as a proportion of GDP, was negligible.WT/L/262
Page 3
7. The consumption expenditure as a percent of GDP gradually declined from 86 per cent in
1985 to 63 per cent in 1994 with private consumption declining from 68 per cent to 39 per cent.  The
consumer price index during the decade increased on an average by 9.5 per cent.
8. While exports have continued to pick up in absolute terms both with India and other
countries, imports have also continued to grow due mainly to foreign-aided construction and
development programmes.  Thus, the trade balance has always remained negative, that is, till recently.Nonetheless, again due to foreign aid, Bhutan had an overall balance of payments surplus and a build
up in foreign reserves to finance 18 months of imports by the end of 1995.  (By 1998 to finance 24
months of imports, and which was also due to exports and tourism earnings).
9. Bhutan's economy is small (a GDP of about US$327 million) but it is closely linked to the
Indian economy due to free trade and commerce betw een the two.  Bhutan has its own currency, the
Ngultrum, which is kept at par with the Indian Rupee, which is also legal tender in the country.  Aid
from India still finances a quarter of development expenditures.  Bhutan also receives externalassistance from as many as 15 multilateral organizations, 19 individual donor countries (bilateral
assistance), 4 financial institutions (ADB, World Bank, IFAD and KFAED) and some non-
governmental organizations.  Most of Bhutan's foreign trade is with India and accounts for 72 per cent
of total import and 92 per cent of export.  Trade with countries other than India accounts for 28 per
cent of total import and 8 per cent of total export.  Below is a synopsis of the major export and importduring the year 1995-96:
Major Imports: Major Exports:
(in million)
- mineral fuels and oils Nu. 379 m (10%)
- cereals Nu. 268 m  (7%) - electrical energy Nu. 721 m (22%)- boilers & mechanical - calcium carbide Nu. 499 m (15%)
machinery Nu. 249 m  (7%) - ferro siliconNu. 339 m (10%)
- vegetable fats & oils Nu. 135 m  (4%) - particle board Nu. 329 m (10%)
- beverage and spirits Nu. 127 m  (3%) - portland cement Nu. 278 m (8%)
- iron and steel Nu. 115 m  (3%) - cardamons Nu. 74 m   (2%)- vehicles & parts Nu. 111 m  (3%) - sawlogs (hard) Nu. 72 m   (2%)
- electrical machinery - mixture of juices Nu. 66 m   (2%)
and equipment Nu. 107 m  (3%)
II. OVERALL DEVELOPMENT STRATEGY
10. Bhutan's past development efforts have consistently been directed to improving living
standards, sustainable development, preservation of religious and cultural values and the natural
environment.  Since Bhutan opened its doors to the outside world in the 1960s, the Royal Government
has welcomed external assistance on a selective basis to support its development plans, while seeking
to ensure that such aid is sustainable, rather than creating continued dependence.  As with all
countries the preservation of national security is seen as a prerequisite for peace and meaningful
development, as well as standards of living.WT/L/262
Page 4
11. These broad goals are reflected in the Eight Five Year Plan (8FYP).  The main objectives and
strategy of the planned document are to:
(a) Achieve self reliance, particularly internal resource mobilization;
(b) Promote sustainability;
(c) Develop human resource and strengthen the Institutions;
(d) Secure and promote balanced development;(e) Improve the quality of life;
(f) Promote economic efficiency;
(g) Bring about Decentralization and Community participation;
(h) Upkeep the interest of National Security;  and
(i) Privatization and private sector development.
In addition to the above major objectives:
- The need to enhance the Kingdom's net national income by increasing the proportion
of Net National Product originating in the industrial sector ;
- Promote industrial development within a free enterprise economy;
- To regulate and promote the private sector;
- To increase third country exports;
- To improve Government revenue through greater tax collections from a larger and
more successful commercial sector;  and
- Promote where possible, sustainable development of the Kingdom's resources.
Briefly the strategies for achieving the objectives on Privatization will be done through:
(a) Reliance on market based mechanisms by further privatization of public enterprises
and contracting out of the many departmental activities to the private sector;
(b) Replacement of Quantitative restrictions by tariff through tariff reduction and
simplifying the sales tax structure;
(c) Incentives for Regional balanced grow th by promoting more growth in the
manufacturing and trading sectors;
(d) Fostering indigenous entrepreneurial and management enterprise;  and(e) Providing increased opportunities for saving and investing within the Bhutanese
economy.
III. ECONOMIC POLICY MEASURES
The macro-economic outlook of the 8FYP are bein g concentrated in the following core areas;
(a) Hydropower and Industries
Development of hydropower and industries are considered important development
strategies for enhancing the goal of self-reliance and sustainability.  Hydropower is one of the
major renewable resources (Potential : 30,000 MW;  Present installed capacity : 400MW;
Under construction: 1,100 MW) which remains to be harnessed fully for economic
development.  Hydropower is expected to provide a cascading effect on establishment of
industries, economic development and improvement in living standards.WT/L/262
Page 5
(b) Infrastructure
Infrastructure is viewed as a prerequisite for starting any development.  Bhutan has
already established a good nationwide and international telecommunications facility.
However, domestically, development of infrastructure is difficult due to the scattered and
sparse pattern of human settlements broug ht about by mountainous and rugged terrain.
During the 8FYP, development of infrastructure consisting of services such astelecommunication, roads, transport, and human settlement have been allocated 20 per cent of
the plan outlay in order to further improve and expand these facilities.
(c) Renewable Natural Resource Sector Development
The development of this sector is important as 85 per cent of the people are
dependent on it for their livelihood.  The contribution of the sector is specially significant for
the achievement of the national goal of establishing food security and self sufficiency and
increasing the income of people at the grassroots level.  Throughout the five year plans, thesector has been accorded high priority.  During  the 8FYP, the sector would continue to focus
on increasing food production and cash crops (potatoes, apples, oranges, cardamom, ginger,
etc.) development in order to improve the income of the people and enhance living standards.
(d) Mining and Quarrying
With the starting of construction of the Dungsum Cement Project and the expansion
of the existing Penden Cement factory, a growth rate of 20 per cent is estimated.  Bhutan
today mines limestone, dolomite, coal, gypsum and other minerals - mostly for industries and
exports.
(e) Construction
Based on the past trends of 24 per cent growth rate and future investment in power
sector projects, a growth rate of about 7 per cent is assumed.
(f) Manufacturing
Since the 1980s, the manufacturing sector was growing at an average of 15 per cent
per annum, although the base was small.  However, during the 7FYP manufacturing growth
slowed down to 9.1 per cent.  Growth is pr ojected at 12 per cent during the 8FYP.
(g) Agriculture
Reviewing the past trends an increase of 3 per cent per annum is expected.  For
forestry and logging, a growth rate of 2 per cent per annum is projected using past trends and
continuing emphasis on environmental sustainability.
(h) Health and Education
Bhutan is committed to the goal of Health for All by 2000.  To this end, various
programmes such as Expanded Programme on Immunization (EPI), National Tuberculosis
Control Programme (NTCP), Leprosy Control Programme, Malaria Control Programme,
National STD/AIDS Prevention and Control Programme are being implemented.  The health
service coverage in 1992-93 was about 70 per cent, but it has increased to over 90 per cent in
the 7FYP.WT/L/262
Page 6
As of May 1995, there were 102 community schools, 143 primary schools and 7
private schools catering to primary education in the country.  Besides, all the 19 junior high
schools had primary sections attached to them.  In all, 59,718 students were enrolled in
primary education programme (PP-VI) in these schools out of which 25,872 (43 per cent)
were girls.  To cater to secondary education, there were 19 junior high (Class VIII) and 9 high
schools (Class X) in 1995 out of which 4 high schools were also providing junior collegeeducation (Class XI-MI).  The enrolment during this period at the junior high level and high
level was 8,123 and 3,432 respectively.  In classes M and XR, the enrolment was 667.  Girls
enrolment constituted 5,120 (42 per cent) at these levels.  Higher education is provided by
Sherubtse College which offers general and honours courses for Bachelor of Science, Arts
and Commerce degrees.  As of 1997, total enrolment in Bhutanese institutions increased to
92,267 (approximately 1/7 of population) from 70,886 in 1994.
The National Institute of Education offers courses in Post Graduate Certificate of
Education, B.Ed and primary teacher training while the Teacher Training Centre provides
2-year primary teacher training programmes.  The enrollments in Sherubtse College, the
National Institute of Education and Teacher Training Centre in 1996 were 445, 189 and 177,
respectively.
There are also two formal technical institutes in the country which provide diploma
courses in electrical, civil and mechanical engineering, and certificate courses in motor
mechanics, general mechanics, electrical, building construction and draughting.
In addition, there is also the Simtokha Rigney school which caters to the study of the
Dzongkha language and traditional arts, the National Institute for the Disabled and the
Sanskrit Pathsalas which provide Sanskrit education.
(i) Human Resource Development
HRD has received priority impetus, considering it as one of the key areas of
socioeconomic development.  To enhance human capital development the in-country and
external training receives strong support.
IV. FOREIGN TRADE REGIME
12. Bhutan has an Agreement on Trade and Commerce with India which allows free trade
between the two countries.  Bhutan also has an Agreement on Trade with Bangladesh.  On the basis of
this agreement, each country offers concessional tariffs to each other on selected commodities.
13. Bhutan also enjoys two multilateral tariff preferences.  These multilateral trade preferences in
favour of Bhutan are :
- South Asian Preference Trade Agreement (SAPTA), and the
- Generalized System of Preferences (GSP)
(a) Bhutan Customs Rules and Regulations and Customs Tariff Schedule 1996
Bhutan is not a member of the World Customs Organization (WCO) nor has it
acceded to any International Conventions.  The Customs Administration control in Bhutan are
presently governed by the Bhutan Customs Rules and Regulations and Customs Tariff
Schedule 1996.WT/L/262
Page 7
(b) Due to the free trade and commerce agreement between India and Bhutan, no customs
duties are imposed by either of the Governments on their imports and exports to each other.
All goods arriving from third countries must be declared at the customs point of entry
in Bhutan for the purpose of customs examination and levy of import duty as per Customs
Tariff in force which presently vary from 0 per cent to 100 per cent depending upon the
nature of goods.  These imports of goods are permitted only for use or sale within the territoryof Bhutan and must be authorized through an import licence issued by the Ministry of
Finance. (Customs Tariff attached as Annexure A).  Re-export of such imported goods into
India are prohibited.
(c) Tariff exemption
If the Royal Government of Bhutan i.e. the Ministry of Finance, is satisfied that it is
necessary in the interest of public to exempt any goods or class of goods from the customs
duty leviable thereon, it may do so by issuing an import duty exemption certificate.
(d) Other duties and charges - Warehouse & Storage charges
The Department of Customs may approv e a Customs warehouse at any station
wherein dutiable/taxable goods may be deposited without payment of duty or tax.  With the
permission of a Customs Officer, any warehoused goods may be cleared by the importer or its
owner for home consumption or export on presentation of the prescribed import form orexport form as the case may be and on payment of any duty, taxes, penalty, rent or any other
charges payable on such goods.
For goods stored in Customs warehouse, Customs will charge such rent or any other
charge in relation to storage of goods.  If any warehoused goods are not cleared within
14 days of issuance of arrival intimation, storage charges will be collected at the ratesapproved by the Royal Government which shall be displayed at the warehouse.
(e) Import restrictions
The import of the following goods into Bhutan are prohibited:
(i) narcotics and psychotropic drugs and substances;
(ii) pornographic materials;  and(iii) any other goods which are prohibited by any laws or international
conventions or treaties to which Bhutan is a signatory.
The import of the following goods into Bhutan are restricted and require special
permission from the relevant agencies of the Royal Government:
(i) Arms and ammunition;
(ii) Explosives and explosive devices;
(iii) Animals and plants classified as an endangered species and their parts and
products;
(iv) Industrial wastes and residues;
(v) Wireless and remote sensing telecommunication, broadcasting equipment;
(vi) Used or second hand vehicles;  and
(vii) Chemicals.WT/L/262
Page 8
(f) Export restrictions
The export of the following goods from Bhutan is strictly restricted/prohibited:
(i) Antiques;
(ii) Animals and plants classified as an endangered species and their parts and
products.
(g) Customs Valuation
Although Bhutan is not a signatory to any international agreement on customs
valuation, it presently follows the Brussels Definition of Value (BDV).  Whenever the
customs duty is chargeable with reference to the CIF value to any goods, or value is to be
determined for the purpose of any of the provisions of the Custom rules and regulation, such
value shall be the price at which such goods are normally sold for delivery at the time and
place of delivering for importation or exportation, as the case may be, in the course of
international trade.
- Valuation by minimum price list of commodities:
Whenever the Customs Officer is not satisfied with the value declared, he
shall determine the value based on the standard price list.
- Valuation by best judgement:
Where value of any goods cannot be determined in accordance with theCustoms rules, the Officer may determine the value by his best judgement in
the manner provided below.
The importer, exporter, owner or their authorized person shall be required to submit
bills/invoices relating to such goods and the value mentioned in such documents shall be
treated as the value of the goods.  If, however, the Customs Officer has reason to believe thatsuch documents are not likely to be submitted within a reasonable time or such documents do
not represent the correct value, the value shall be determined on the basis of one or more of
the following:
(i) price charged in the normal course of business by a producer or manufacturer
of the goods in Bhutan under competitive conditions;
(ii) price at which such or comparable goods are offered for sale in the country of
origin;
(iii) if any of the prices mentioned above are not available, the Customs Officer
may determine the value by his best judgement with reference to market
inquiries or international price catalogue of such goods, if available.
(h) Customs formalities
Bhutan has not yet acceded to the Kyoto convention on the simplification and
harmonization of customs procedures.  The Customs formalities are outlined broadly under
the Bhutan Customs Rules and Regulations, 1996.
Bhutan Customs Rules and Regulations 1996
The Customs Rules and Regulations, 1996 aspires to lay down self-contained
Customs rules and procedures in a comprehensive manner to enable the Revenue & Customsof the Ministry of Finance to exercise effective control on all imports and exports and
collection of Customs duties and taxes as per the Royal Government's policy.  These rulesWT/L/262
Page 9
have been designed on the basis of international customs practices with the objective of
providing a simplified procedure to facilitate international trade under a harmonized system.
These rules shall be enforced in line with this policy and other guidelines that may be issued
by the Ministry of Trade and Industry from time to time.  Such guidelines would aim at
improving the balance of trade and fulfilling the Royal Government's obligation and objective
arising out of bilateral agreements, regional and international agreements under the SouthAsian Association for Regional Co-operation, the World Trade Organization and World
Customs Organization respectively.
(i) Export regulation
- Export licence/Certificate
No goods shall be exported to a third country from Bhutan (i.e. with the
exception of India) except under the authority of an export licence issued by the
Ministry of Trade and Industry of Royal Government.  Such licences shall specify thefull description and value of goods authorized to be exported.
- Policy of Export
Notwithstanding the above clause, the Royal Government may by
notification prescribe the procedure for the issuance of licence and lay down the
policy regulating export of any goods or class of goods.
- Condition and Validity of licence
An export licence may be issued with out without any conditions attached to
it and shall be issued mentioning a specific period of its validity.
- Production of licence
Whenever clearance of any goods is to be allowed under the authority of a
licence, such clearance shall be permitted only on production of the original copy of
the export licence.
(j) Business licensing
Trading companies, firms and business establishment which intend to engage in
import business are required to register themselves with the Ministry of Finance (MoF).  Noindividuals, companies, firms etc. other than th ose registered with the MoF, shall be granted
import licences to import goods from third countries for commercial sale within Bhutan.
(i) The applicant must be a Bhutanese citizen and have valid trade licences for
the items to be imported;
(ii) The applicant must have an established shop/outlet, or a place of business and
the necessary infrastructure for carrying out import business;
(iii) On registration, the MoF will allot a distinctive code number to each
importer.  Every application for import licence by a registered importer must
invariably bear the respective code number.WT/L/262
Page 10
ANNEX
CUSTOMS TARIFF SCHEDULE - 1996
Bhutan Customs Rules and Regulations 1996
Ch. No Description of Commodity Tariff %
SECTION I:  LIVE ANIMALS, ANIMAL PRODUCTS
1 Live animals
Live stock including poultry0
2 Meat and edible meat offal
Fresh mutton, chicken, beef, pork, fish and all other meat raw or frozen
(not packed in tins)0
3 Fish and crustaceans, molluscs and other aquatic invertebrates - fresh 10
4 Dairy Products : eggs, milk, natural honey; edible products of animal origin
a) Fresh or unprocessedb) Processed10
20
5 Other products of animal origin, not elsewh ere specified or included like skins, hair,
bones, etc.10
SECTION II:  VEGETABLE PRODUCTS
6 Live trees and other plants - like bulbs, roots, seeds, etc. and the like; cut flowers
a) Live plants, etc.
b) Bamboosc) Seeds0
010
7 Edible vegetables and certain roots and tubers - fresh and dried 10
8 Edible fruit and nuts, peal of citrus fruits or melons
a) Fresh or dried
b) Betel nuts10
20
9 Coffee, tea, mate and spices
a) Tea - packed/looseb) Spices - all kindsc) Coffee in whole or powdered from including instant coffee10
1010
10 Cereals, wheat; maize; rice; millet, etc. All foodgrains/cereals/pulses  0
11 Products of the milling industry; malt; starches; inulin; wheat gluten  10
12 0il seeds; misc. grains and fruit; industrial medicinal plants;  straw and fodder 10
13 Lac; gums, resins and other vegetable saps and extracts 10
14 Vegetable plaiting materials; vegetable products like straw, bamboo, etc. 0
SECTION III:  ANIMAL, VEGETABLE FATS & OILS
15 Animal and vegetable fats or oils; edible fats, animal or vegetable waxes
a) Crude
b) Refined10
10WT/L/262
Page 11
Ch. No Description of Commodity Tariff %
SECTION IV: PREPARED FOOD STUFFS,
BEVERAGES, SPIRITS AND VINEGAR, TOBACCO
16 Preparations of meat, fish and other sea food either packed or canned 20
17 Sugars and sugar confectionery
a) Sugar and mollasses
b) Confectionery and sweets10
30
18 Cocoa and cocoa preparations 30
19 Preparations of cereals, flour, starch or milk pastrycooks' products excluding bread 30
20 Preparations of vegetables, fruit, nuts, or other parts of plants either packed or
canned30
21 Miscellaneous edible preparations
a) Packed20
22 Beverages, spirits and vinegar
a) Aerated water (non-alcoholic beverages) and vinegarb) Beerc) Alcoholic beverages and spirits30
50100
23 Residues and waste from the food industries;  unfit for human consumption*
24 Tobacco and manufactured tobacco products 100
SECTION V:  MINERAL PRODUCTS
25  Salt, sulphur, earths and stone, plastering materials, lime and cement
a) Saltb) Sand boulder and mud (earth)c) Cement
d) Clay Bricks
e) Dolomite Chips and slabsf) Lime stone chips and slabsg) Marble floor, chips, slabs and articles made of marbleh) Not elsewhere specified0
1020
20
20202020
26 Ores, slag and ash for Industrial use 10
27 Mineral fuels, oils and products of their distillation;
bituminous substances, mineral waxesa) Bitumenb) Petrolc) Diesel
d) Lubricants
e) Kerosenef) LPGg) Not elsewhere specified5
55
20
555
                                                     
* ProhibitedWT/L/262
Page 12
Ch. No Description of Commodity Tariff %
SECTION VI:  PRODUCTS OF THE CHEMICAL OR ALLIED INDUSTRIES
28 Inorganic chemicals;  organic compounds of precious or rare-earth metals 0
29 Organic chemicals 10
30 Phramaceutical products 10
31 Fertilisers 10
32 Tanning;  dyes, pigments and other colouring matter, paints and links
a) Varnishes, vegetable paints removers, stainers of all kindsb) All parts of paints including acrylic and plastic emulsion paints, lacquers,
cement colour or paints, enamels, liquid paints, etc.
c) Not elsewhere specified10
10
10
33 Essential oils and resinoy, perfumery cosmetics or toilet preparations
a) Cosmeticsb) Hair oilc) Toothpaste, powder, brush
d) Shaving sets, safety razors, razor blades
e) Incense stickf) Not elsewhere specified30
3030
30
3030
34 Soap, washing, lubricating & polishing preparations, waxes, candles
a) Soaps of all kinds, wrashing, shaving, toilet medicated, liquid, washing
powder, etc.
b) Shoe polish including shoe creamsc) Not elsewhere specified30
3030
35 Albuminoidal substances;  modified starches;  glues;  enzymes 10
36 Explosives;  pyrotechnic products;  matches;  certain combustible preparations
a) Explosiveb) Matches*
20
37 Photographic or cinematographic goods
a) Photographic and other cameras and enlargers and spare parts, accessories
and component parts thereof lenses films, plates, paper and cloth and otheraccessories used therewith
b) Cinematographic equipments including cameras, projectors and sound
recording & other parts30
30
38 Miscellaneous chemical products
a) Insecticides, fungicides, herbic ides, germicides and pesticides
b) Not elsewhere specified10
10
SECTION VII:  PLASTICS AND ARTICLES THEREOF;  RUBBER ANDARTICLES THEREOF
39 Plastics and articles thereof
a) Primary form
b) Semi finished formc) Finished form10
2030
                                                     
* ProhibitedWT/L/262
Page 13
Ch. No Description of Commodity Tariff %
40 Rubber and articles thereof
a) Primary formb) Semi finishedc) Processed10
2030
SECTION VIII:  RAW HIDES AND SKINS, LEATHER AND ARTICLESTHEREOF (OTHER THAN FUR SKINS)
41 Leather, raw hides & skins and leather 10
42 Articles of leather:  travel goods, hand bags, and articles of animals gut
a) Leather goods, other than shoes
b) Luggage, suitcase and handbags
c) Others not specified elsewhere30
30
30
43 Fur skins, artificial fur and manufactured articles thereof 30
SECTION IX:  WOOD & ARTICLES OF WOOD, WOOD CHARCOAL;  CORK;MANUFACTURES OF STRAW OF ESPARTO, ETC.
44 Wood and articles of wood;  wood charcoal
a) Charcoalb) Timberc) Plywoodd) Furniture of wood if manufactured with aid of power
e) Furniture of wood manufactured without aid of power
f) Not elsewhere specified10
103030
30
30
45 Cork and articles of cork 10
46 Manufacturers of straw, esparto & other plaiting materials;  basketware & wicker
work 10
SECTION X:  PULP OF WOOD, WASTE AND SCRAP OF PAPER OR
PAPERBOARD
47 Pulp of wood, waste and scrap of paper or paper broad 10
48 Paper and paperbroad articles of pa per, pulp, paper or paper board 10
49 Printed books, newspapers, pictures;  manuscripts;  typescripts;  plans;  maps
a) Newspaperb) Books and periodicalc) Not elsewhere specified5
55
SECTION XI:  TEXTILES AND TEXTILES ARTICLES
50 Silk
a) Yarn
b) Fabric10
20
51 Wool, fine or coarse animal hair;  horse hair yarn and woven fabric
a) Textile
b) Yarn20
10
52 Cotton
a) Yarnb) Fabric10
20WT/L/262
Page 14
Ch. No Description of Commodity Tariff %
53 Other vegetable textile fibres;  paper
a) Yarnb) Fabric10
20
54 Man-made filaments
a) Yarnb) Fabric10
20
55 Man-made staple fibres
a) Yarn
b) Fabric10
20
56 Wadding, feld and nonwovens;  special yarns;  twine, cordage, ropes and cables
a) Yarn
b) Fabric 10
20
57 Carpets and other textile floor coverings 20
58 Special woven & tufted textile fabrics;  tapestries;  trimmings;  embroidery 20
59 Impregnated or laminated textile fabrics;  textile articles for industrial use
Laminated sheets like formica and sunmica, linoleum20
60 Knitted and crocheted goods 20
61 Articles of apparel and clothing accessories, knitted or crocheted goods 20
62 Articles of apparel and clothing accessories, notknitted or crocheted 20
63 Other textile articles;  sets;  worn clothing and worn textile articles;  rugs Blanket
20
SECTION XII:  FOOTWEAR, HEADGEAR, UMBRELLAS, WALKING &SEAT-STICKS, WHIPS, RIDING CROPS
64 Footwear, gaiters and the like;  parts of such articles 20
65 Headgear and parts thereof 20
66 Umbrellas, walking-sticks, seat-sticks, whips, riding-crops and parts thereof 20
67 Articles made of feathers or of down artificial flowers; 20
SECTION XIII:  ARTICLES OF STONE, PLASTER, CEMENT, MICA ORSIMILAR MATERIALS
68 Articles of stone, plaster, cement, mica or similar materials 20
69 Ceramic products
Ceramic tiles20
70 Glass and glassware
Crockery20
SECTION XIV:  NATURAL OR CULTUR ED PEARLS PRECIOUS OR SEMI-
PRECIOUS STONESWT/L/262
Page 15
Ch. No Description of Commodity Tariff %
71 Pearls, semi/precious stones, precious metals, imitation jewellery;  coin
1) Gold2) Silver3) Precious & semi-precious jewellery4) Imitation jewellery
5) Not elsewhere specified30
303030
30
SECTION XV:  BASE METALS AND ARTICLES OF BASE METAL
72 Iron and steel
a) Primary
b) Processed10
20
73 Articles of iron or steel
a) CGI sheet
b) Hardware items & hand tools
c) Articles other than utensils made of stainless steeld) Pipes & fitting (GI, CI, PVC)e) M.S. rodf) Wire ropes
g) Sanitary ware and other bathroom fitting
h) Drill rodsi) Prefabricated bridge partsj) Iron & steel furniturek) Not elsewhere specified20
20
20202020
20
20203020
74 Copper and articles thereof
a) Primaryb) Articles10
20
75 Nickel and articles thereof
a) Primaryb) Articles10
20
76 Aluminium and articles thereof
a) Primaryb) Articles10
20
77 Reserved for possible future use
78 Lead and articles thereof
a) Primary
b) Articles10
20
79 Zinc and articles thereof
a) Primary
b) Articles10
20
80 Tin and articles thereof
a) Primaryb) Articles10
20
81 Other base metals;  cermets;  articles thereof
a) Primaryb) Articles10
20WT/L/262
Page 16
Ch. No Description of Commodity Tariff %
82 Tools, implements, cutlery, spoons and forks, of base metal
a) Cutleryb) Tools and implementsc) Not elsewhere specified10
1010
83 Miscellaneous articles of base metal 20
SECTION XVI:  MACHINERY AND MECHANICAL APPLIANCES;
ELECTRICAL EQUIPEMENT, PARTS THERETO
84 Machinery and mechanical appliances;  parts thereof mechanical appliances;  parts
thereof
a) Industrial equipments and machinery
b) Lifts and its accessoriesc) Typewriters, tabulating machines & calculatorsd) Weighing machines and componentse) Refrigerators and components
f) Washing machines
g) Heavy earth moving equipments like bulldozer, scrapers, excavators,
wheel-loaders, pile layers, etc.
h) Fork liftsi) Boilers, engines, etc.0
10101010
10
0
1010
85 Electrical machinery and equipment;  sound & images recorders and reproducers
and parts thereofa) Generators, motors, transformers, batteries and accessories
b) Electrical domestic appliances
c) Electrical goods for lighting/fittingd) Electrical goods for audi o/video & accessories TV, VCR, music system etc.
e) Electrical heating & cooling appliances and accessoriesf) Telecom equipment & accessories
g) Computers, office equipments & accessories
h) Not elsewhere specified20
10
30
30
20
20
1030
SECTION XVII:  VEHICLES, AIRCRAFT, VESSELS AND ASSOCIATEDTRANSPORT EQUIPMENT
86 Railway locomotives, railway track & traffic signalling equipment 10
87 Vehicles and parts thereof and accessories
a) Motor scooters, mopeds, motor cyclesb) Light motor vehiclesc) Passenger busesd) Goods vehicle
e) Spare parts of vehicles
f) Power tillersg) Tractorsh) Perambulator including push chairs for babiesi) Bicycles and other cycles not motorisedj) Not elsewhere specified20
30020
20
00102030
88 Aircraft, spacecraft and parts thereof 10
89 Ships, boats and floating structures 10WT/L/262
Page 17
Ch. No Description of Commodity Tariff %
SECTION XVIII:  OPTICAL, PHOTOGRAPHIC, MEASURING
MEDICAL/SURGICAL, MUSICAL INSTRUMENTS, CLOCKS & PARTS
90 Optical, photographic, measuring, precision, medical or surgical instruments
a) Optical and accessoriesb) Photographic equipment and accessoriesc) Medical equipment and accessoriesd) Not elsewhere specified10
301030
91 Clocks and watches and parts thereof
a) Watches, clocks, time-pieces and its components30
92 Musical instruments, parts and accessories of such articles 30
SECTION XIX:  ARMS AND AMM UNITION, PARTS AND ACCESSORIES
THEREOF
93 Arms and ammunition, parts and accessories thereof*
SECTION XX:  MISCELLANEOUS MANUFACTURED ARTICLES
94 Furniture, bedding, mattresses, lamps, prefabricated buildings 30
95 Toys, games and sports requisites, parts and accessories thereof
a) Toys
b) Sport goodsc) Not elsewhere specified20
1020
96 Miscellaneous manufactured articles
a) Cigarette cases and lighters
b) Stationery - brooms, brushes, buttons, pens including ball point pens,
pencils - leads, pastels, chalks and tailors chalks
c) Stationery - Not elsewhere specified30
10
10
SECTION XXI:  WORKS OF ART, COLLECTORS PIECES AND ANTIQUES
97 Works of art, collectors, pieces and antiques 30
98 Codes for special transactions
99 Reserved for other special uses
__________
                                                     
* Prohibited