India’s Duty-Free Tariff Preference (DFTP) Scheme for Least Developed Countries (LDCs)

India has become a leading partner among developing economies by offering one of the most comprehensive market access schemes for Least Developed Countries (LDCs) under the WTO framework.

• The initiative positions India ahead of China and the European Union (EU) in terms of preferential tariff coverage for LDC exports.

Objective

• The Duty-Free Tariff Preference (DFTP) Scheme for LDCs aims to:
  • Grant tariff preferences (duty-free or reduced tariffs) on imports from LDCs.
  • Facilitate integration of LDCs into global trade by boosting their export competitiveness.

Coverage and Benefits

• Provides duty-free access for a large proportion of tariff lines, covering most export items from LDCs.
• Major beneficiary sectors include:
  • Agricultural commodities – Coffee, tea, processed food
  • Manufactured goods – Textiles, leather products, footwear, handicrafts
• Helps LDCs diversify exports, add value, and connect with global value chains (GVCs).

Background

• The DFTP Scheme was launched by India in August 2008 as part of its commitment at the Hong Kong WTO Ministerial (2005) to provide preferential market access to LDCs.
• Fully implemented in 2015, the scheme now offers duty-free access to over 98% of tariff lines.

Significance

• Enhances India’s role as a champion of South-South cooperation.
• Strengthens economic diplomacy and developmental partnerships with Africa, Asia, and the Pacific’s poorest nations.

Source: The MINT