NEW DELHI, SEPT 12: An apex chamber today warned that WTO agreements could badly hit small scale sector and said SSI export-oriented units be granted deemed export status besides providing venture capital and raising investment limit to Rs 10 crore to make it competitive.In a note to the government, Associated Chambers of Commerce and Industry of India (Assocham) said World Trade Organisation's (WTO) agreement on enhanced market accessibility, agreement on TRIPS and agreement on sanitary and phytosanitary measures could affect the small scale industry (SSI) adversely.The agreement on enhanced market accessibility would increase import of goods including items reserved for SSIs, it said, besides reducing customs duties making domestic goods uncompetitive.Looking at neutralisation of tax incentives due to reduced customs duties, it said although the tax incentive could be raised, the real solution for Indian SSIs lies in withdrawing artificial protection to make them more vibrant.In case of zeroimport intensity exportable items, competitiveness would not be affected, the chamber said. Another positive effect in the international market would be on account of increased market access owing to reduced import duties and withdrawal of quantitative restrictions.Dismissing the fears that the new Patent Act would be detrimental to the interests of SSIs, the Assocham said it would affect only pharmaceuticals and info-tech SSIs. "In pharmaceuticals, mostly the SSIs are producing bulk drugs and WHO-listed drugs and these drugs are outside the purview of patent. Moreover, the patent will apply only to new products," it said in a statement.The chamber said the agreement on sanitary and phytosanitary measures would mainly affect the agro-based products and dairy products.
