India on Monday became the 71st nation to sign the United Nations Convention on International Transport of Goods Under Cover of TIR Carnets (TIR Convention). The move is being considered more than a transport agreement and has a strong foreign policy element.
It could also be India's way of compensating for the perceived foreign policy blunder -- skipping China's One Belt One Road Belt (OBOR) summit.
An official statement from the Narendra Modi government stated that the Convention will give Indian traders access to fast, easy, reliable and hassle-free international system for movement of goods by road or multi-modal means across the territories of other contracting parties.
It will also allow India to take full benefit of International North-South Transportation Corridor (INSTC) by availing access to the Eurasian region via Iran and the Bangladesh-Bhutan-India-Nepal (BBIN) Motor Vehicles Agreement.
"India's decision to implement the TIR system will have far-reaching benefits for trade and will save significant time and money by streamlining procedures at borders, reducing administration and cutting border waiting times," Boris Blanche, Chief Operations Officer at International Road Transport Union, was quoted saying.
TIR has widest geographical coverage
It is a 7200-km long network that involves different modes of transport aimed at cutting down on costs and time when it comes to transportation of freight cars. It aims to boost trade between India, Russia, Iran, Central Asia and Europe.
A report quoted a study conducted by Federation of Freight Forwarders' Association in India shows that INSTC will enable cheaper and shorter routes than the existing ones. Further, there are certain parameters involved in the TIR system- secure vehicles or container, international guarantee chain, TIR carnet, reciprocal recognition of customs controls, controlled access and TIR IT risk management tools.
India had to play better
With China's 'One Belt One Road' being an equally dominant project and India's decision to skip a summit in China, the Modi government had to play it up to count itself within the list of contenders being considered as rising power.
India has had persistent problems when it comes to transport and customs system with other countries, said a report and added that things will ease a bit after the system gets accustomed to global norms.
China had joined the Convention in 2016 and there has been a giant leap in its connectivity projects.
