DAILY NEWS ANALYSIS 18th FEBRUARY 2022

1. Etching a Trade Line to Bond Beyond Oil

India-UAE Comprehensive Economic Partnership Agreement (CEPA) has been signed recently.

Economic Significance of the UAE:

• The UAE has emerged as an important economic hub not just within the context of the Middle East/West Asia, but also globally.
• Strategic location: The UAE, due to its strategic location, has emerged as an important economic centre in the world.
• In recent years, the UAE, through its ‘Vision 2021’, has sought to diversify its economy and reduce its dependency on oil.
• Although the UAE has diversified its economy, the hydrocarbon sector remains very important followed by services and manufacturing.
• As part of the GCC, the UAE has strong economic ties with Saudi Arabia, Kuwait, Bahrain, and Oman, meaning the UAE shares a common market and a customs union with these nations.
• This FTA with the UAE will pave the way for India to enter the UAE’s strategic location, and have relatively easy access to the Africa market and its various trade partners which can help India to become a part of that supply chain especially in handlooms, handicrafts, textiles and pharma.

Current economic ties with UAE:

• India and the UAE established diplomatic relations in 1972.
• The India-UAE total trade merchandise has been valued at U.S.$52.76 billion for the first nine months of the fiscal year 2021-22, making the UAE India’s third-largest trading partner.
• The aim is to boost bilateral merchandise trade to above U.S.$100 billion and services trade to U.S.$15 billion in five years.
• UAE would be an attractive export market for Indian electronics, automobiles, and other engineering products.
• UAE is the ninth biggest investor in India.
• Indian companies have set up manufacturing units either as joint ventures or in Special Economic Zones for cement, building materials, textiles etc.

Challenges:

• The UAE tariff structure is bound with the GCC, and the applied average tariff rate is 5%. Therefore, the scope of addressing Non-Tariff Barriers (NTBs) becomes very important.
• The reflection of NTBs can be seen through Non-Tariff Measures (NTMs) which have mostly been covered by Sanitary and Phytosanitary (SPS) and Technical Barriers to Trade (TBT).
• Most of the notifications are related to consumer information, labelling, licensing or permit requirements and import monitoring and surveillance requirements. These compliances pose a challenge for Indian exporters.

Conclusion:

The FTA agreement must try to bring more transparency and predictability in the use of NTBs so that their compliance becomes less cumbersome.

2. Accrediting Colleges, Varsities

The National Assessment and Accreditation Council (NAAC) has relaxed the eligibility criteria for accreditation of higher educational institutions to “widen the horizon of accreditation”.

• Accreditation is a quality check exercise.
• NAAC conducts accreditation of Higher Educational Institutions (HEI) such as colleges, universities, or other recognized institutions to derive an understanding of the ‘Quality Status’ of the institution.
• The accreditation is done based on parameters such as curriculum, faculty, infrastructure, research, and financial well-being among others.
• Based on these parameters, the NAAC gives institutions grades ranging from A++ to C. If an institution is graded D, it means it is not accredited.

Benefits of accreditation:

• helps institutions attract capital
• helps an institution know its strengths and weaknesses and
• helps students going for higher education abroad as many global higher education authorities insist on recognition and accreditation of the institution where the student has studied.

Process:

• Earlier, only those higher education institutions with two batches of graduated students or which had completed six years of existence were eligible to apply for NAAC’s assessment and accreditation.
• Under the new manual, colleges and universities that have completed even one academic year will be eligible to apply for a newly created category of ‘Provisional Accreditation for Colleges’ or PAC.
• The PAC, which will not offer any grading, will be valid for two years, and institutions cannot get it more than two times.
• In 2019, the UGC launched a scheme, Paramarsh.
• Under the scheme, some of the best performing institutes were identified to serve as mentors to at least five institutes aspiring to get accredited.

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