Amy Horn


Indo Myanmar Border Trade Agreement 1994

The Indian government is also being asked to set up an international bus service linking Moreh to Mandalay. To date, the Burmese junta does not allow Indians to visit Burma by land routes. There are temporary entry opportunities for Indian tourists through the Moreh-Tamu trade point, but tourists are asked to return the same day before the evening. Therefore, it is impossible for tourists to visit Mandalay, which takes at least 12 hours to get from Theh-Tamu point. The bus that connects Moreh to Mandalay would not only help traders, but would also bring tourists from Myanmar to India. Udai Bhanu Singh replies: Trade on the Indo-Myanmar border was traditionally managed on an informal basis and was quite negligible compared to normal trade. Trade in traditional head and barter products was common practice. When India and Myanmar signed a border trade agreement in 1994, a legal basis was given to trade. Moreh`s Land Customs Station (LCS) was the first trading platform to be commissioned in 1995, on the Indo-Myanmar border. The second is the Zowkhathar-Rhi LCS.

A third LCS will be opened in Avakhung-Pansat/Somrai. An interesting aspect of India`s trade with Bangladesh and Myanmar is that, in the case of Bangladesh, India has maintained a large trade surplus and its trade balance is negative vis-à-vis Myanmar. In 2010-11, India`s trade surplus with Bangladesh exceeded $3 billion, although imports increased by more than 62% over the previous year. In contrast, India`s trade deficit with Myanmar exceeded $600 million in 2010-11, less than half the one-year value. India is discussing this issue very seriously, as there are cases where non-BIMST countries have used Sri Lanka and Thailand as comfortable destinations to dispose of their products in India. It is clear from the above debate that Myanmar`s economic regime, in particular the foreign trade and exchange rate mechanism component, is an obstacle to the free movement of trade on the basis of economic complementarities within the framework of acceptable economic governance. To build border trade on a solid footing and put informal trade on formal channels, several reform measures need to be developed ranging from changing the basic rules of border trade to transitioning to an appropriate currency exchange mechanism. The volume of trade between the northeastern states of India and Myanmar has not been encouraging.

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