SAARC area cross-border timber trade, regional institutional mechanisms and trade link with Myanmar Some results
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1 SAARC area cross-border timber trade, regional institutional mechanisms and trade link with Myanmar Some results Dr. Sepul K Barua Dhananjay Kumar Indufor Oy, Helsinki, Finland
2 Contents Background and objectives Timber and timber products trade Policy and regulatory framework Regional institutional mechanisms Future outlook Issues for brainstorming
3 SAARC members are not major timber exporting countries in the world Timber trade takes place In significant quantity between SAARC region and Myanmar Also among SAARC member countries Forestry is a cross-cutting issue in regional cooperations in SAARC SAARC Forestry Centre, Thimphu Growing importance of forestry issues Background
4 Background Rich in forest resources in general Economic contribution is marginal except in Bhutan and Nepal Northeastern region of India has border with Bangladesh, Bhutan, Myanmar and Nepal Kolkata sea port in India also serves Bhutan and Nepal Northeastern region of India Source: FAO Forestry Country Profiles 2006
5 Objectives The key objectives of the study are to develop: A baseline information on Timber product flow and timber trade, forestry issues in SAARC region, SAARC region s timber trade link with Myanmar and important outside markets Recommendations for potential activities in South Asia on strengthening forest law enforcement, governance and trade including existing regional institutional mechanisms In this presentation, we will focus on Timber and timber products trade: Among the project countries in SAARC region Between the project countries in SAARC region and Myanmar Policy and regulatory frameworks Regional institutional mechanisms
6 Trade of timber and timber products Project countries in SAARC region India is by far the biggest trader, Bangladesh a distant second Used to be the two of the major importers of timber from Myanmar Sri Lanka also trades in sizeable amount Rather weak tradelink with Myanmar The trade by Bhutan and Nepal, especially in terms of export Minimal trade with Myanmar
7 Trade of timber and timber products Project countries in SAARC region Export of timber and timber products India exports to all other project countries, while Sri Lanka and Bhutan mainly export to India. The export of industrial roundwood is insignificant. Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
8 Trade of timber and timber products Project countries in SAARC region Import of timber and timber products Imports from India by other project countries out-value the country s imports from them. Industrial roundwood import is insignificant. Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
9 Trade of timber and timber products SAARC region -India Total trade of timber and timber products India is a net importer country with large trade deficit, which, however, had been decreasing in recent years Source: Comtrade, FAO Stat, ITTO Annual Review Statistics, and Department of Commerce, Government of India
10 Trade of timber and timber products SAARC region -India Export of timber and timber products to other project countries in SAARC region Export to all countries, with most to Sri Lanka Source: Comtrade, FAO Stat, ITTO Annual Review Statistics, and Department of Commerce, Government of India
11 Trade of timber and timber products SAARC region -India Export of timber and timber products to other project countries in SAARC region Mostly paper and paper board Source: Comtrade, FAO Stat, ITTO Annual Review Statistics, and Department of Commerce, Government of India
12 Trade of timber and timber products SAARC region -India Import of timber and timber products from other project countries in SAARC region Most import of came from Sri Lanka Source: Comtrade, FAO Stat, ITTO Annual Review Statistics, and Department of Commerce, Government of India
13 Trade of timber and timber products SAARC region -India Import of timber and timber products from other project countries in SAARC region Fibreboard and paper & paperboard are the main import products Source: Comtrade, FAO Stat, ITTO Annual Review Statistics, and Department of Commerce, Government of India
14 Trade of timber and timber products Link with Myanmar Total trade of timber and timber products with Myanmar Project countries in SAARC region had huge and rapidly growing trade deficit with Myanmar Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
15 Trade of timber and timber products Link with Myanmar Import of timber and timber products from Myanmar India imported the most, followed by Bangladesh Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
16 Trade of timber and timber products Link with Myanmar Import of timber and timber products from Myanmar Industrial roundwood was the key imported products Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
17 Trade of timber and timber products Link with Myanmar Export partners of Myanmar Project countries combined (mainly India) followed by China Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
18 Trade of timber and timber products Link with Myanmar Export products of Myanmar Industrial roundwood was by far biggest export product followed by sawntimber Source: Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre
19 Policy and regulatory framework Indian Forest Act 1927 remains to be the mother regulatory framework for all study countries. However, each country has amended the acts and policies in light of: Emerging biotic pressures Changing global scenario Depleting forest resources, and The government s resolutions for conservation and maintain forest cover in the country
20 Policy and regulatory framework Framework India Key features Indian Forest Policy, 1988 Adopted by all the states Conservation oriented Meeting need of forest dependent people Participatory management Restricting raw material supplies to wood based industry Forest Right Act, 2006 Liberalised traditional land right of forest dwellers Bangladesh Forest Policy, 1979 First forest policy of Bangladesh Forest Policy, 1994 Horizontal expansion to increase forest cover to 20%by 2015 Planting trees on non-forest land Public and NGO participation Urban forestry Special attention to the hill districts of Banderban Rangamati and Khagrachari for afforestation Promotion of forest-based small-scale enterprises
21 Policy and regulatory framework Framework Bhutan Key features Bhutan Forest Act, 1969 First forest act in the country Bhutan Forest Act, 1991 Focuses on conservation and encourages community forestry and forests on private lands Forest and Nature Conservation Act, 1995 Provided legal framework for protection and sustainable use of forests The Land Act of Bhutan,2007 Clarifies that trees, either naturally grown or planted, belong to the landowner when grown on registered land Provides for the leasing of government reserved forest land for economic and various other activities Nepal Master Plan for Forestry Sector, 1988 Puts heavy emphasis on community forestry Local control, separate program on NTFPs with medicinal plants as a main components Revised Forestry Sector Policy 2000 Participatory management Community forestry Protection of soil and forests Industry orientation
22 Policy and regulatory framework Framework Sri Lanka Key features The Forest Ordinance No. 16, 1907 First forest act in the country The National Environmental Regulations No. 1, 1993 Prohibits forest conversion to non-forest use for areas over one ha Demands an environmental impact assessment for timber harvest and forest plantations in areas over 5 ha Amendment in Forest Ordinance Act, 2009 Has brought changes in laws for protection, sustainable management of forests and emphasised on community involvement Defined benefit sharing mechanism Myanmar Burma Forest Act, 1992 First policy statement Balanced approach towards conservation and development Sustainable forestry Decentralization of forest management Private sector involvement in timber trade Community forestry Forest Rule, 1995 Legal framework to promote community participation
23 Policy and regulatory framework Summary Project countries in SAARAC region have conservation oriented policies and production on non-forest lands is encouraged There are provisions to establish chain of custody and also law to counter illegal harvesting, transportation and trade Exports of logs banned in all the countries, Myanmar being the latest entrant (April 2014) Almost all the countries are net importer of timber barring Myanmar Processed timber is allowed to exports with varied provisions in different countries Despite ample provisions and well laid policies, the forests are being degraded Certification is not being considered seriously since barring Myanmar no other country is exporting a sizeable quantity of timber and timber products Well placed existing provisions guarded by laws are the other reasons for reluctance
24 Policy and regulatory framework Summary continues Land tenure system, usufruct rights are few of the deterrent not covered adequately in policies. Especially in Northeastern India, northern Nepal, Chittagong Hill Tracts of Bangladesh and also to some extent in Bhutan, the ownership of and access to forests are ambiguous None of the policies speak on illegal cross-country timber trade, however, the custom acts have provisions for boarder checks but mostly for revenue collection Open and porous land border along India with all these countries (barring Sri Lanka) is a major cause for illegal cross-country trade and harvesting Conservation and livelihood are the conflicting factors influencing policies and laws in all these countries
25 Regional institutional mechanisms Regional Institutions SAARC Forestry Centre Has reach to all SAARC member countries Focus on important forestry issues Cooperation with international organizations ICIMOD Direct reach to all SAARC countries except Sri Lanka and Maldives; Myanmar is also a member Intergovernmental organization, can influence government decisions Forest and climate change issues
26 Regional institutional mechanisms Regional Trade Mechanisms SAFTA Agreement All SAARC nations are signatory Most timber products are included So far has very little or no impacts on boosting timber product trade in the region Indo ASEAN Free Trade Area Agreement Most timber products are included Progressive tariff reduction Boost India s roundwood and sanwtimber import from ASEAN countries Hurts India s domestic paper industry
27 Future outlook Export of high value products especially from India handicrafts, furniture, and high quality paper Growing deficit in industrial roundwood in the project countries in SAARC region in the future Reliance on import will grow Increase in illegal logging and timber smuggling? Source: : Comtrade, ITTO Annual Review Statistics, FAO Stat, Ministry of Forestry and Agriculture, Government of Myanmar, and Department of Commerce, Government of India, Sri Lanka Customs and Nepal Trade Promption Centre; 2014: estimate; : projections
28 Issues for brainstorming Impacts of Myanmar log export ban on SAARC region Will more logs be sourced from the neighbouring SAARC countries? Where will be alternative source of logs for India and Bangladesh be? Will India or Bangladesh transfer their processing/invest in Myanmar? Are the policies and regulations in these countries adequate, what are the real challenges to implementation? Will there be any support for improved governance and trade at a regional level? Is it better to have bilateral MoUs or regional cooperation?
29 Thank You
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