TRADE AND PAYMENTS AGREEMENT BETWEEN THE GOVERNMENT OF INDIA AND THE GOVERNMENT OF THE CZECHOSLOVAK SOCIALIST REPUBLIC
Prague, 3 November 1960
The Government of India and the Government of the Czechoslovak Socialist Republic animated by the desire to further develop economic
and trade relations between the two countries on a mutually advantageous basis and to increase the volume of trade between them to
as high a level as possible, have agreed upon the following
1. Both Governments will in every possible way develop and strengthen the economic and trade relations between the two countries on
the principles of equality and mutual benefit. They will study and with the utmost goodwill take decisions on the suggestions which
either of them would like to present for the consideration of the other, with the purpose of achieving closer economic relations.
2. For the goods imported and exported from one country to the other, both Governments will endeavour to grant all facilities allowed
by the respective laws, rules and regulations. During the period of validity of this Agreement, the total value of imports will be
equal to the total value of exports effected by either country, taking into account also the non-commercial payments on both sides.
(a) Both the Parties shall grant each other most-favoured-nation treatment in respect of Customs duties and charges on any account
imposed on imports or exports or in respect, of method of levying such duties and charges and in respect of rules, formalities and
charges in connection with Customs clearing operations.
(b) Further, the two Parties will grant each other, in respect of the issuance of import and export licences, treatment no less favourable
than that granted to any other country.
(c) Any advantage, favour, privilege or immunity granted by either of the Contracting Parties to any product originating in the territory
of a third country or destined for its territory, shall be granted immediately and unconditionally to the like product originating
in the territory of either of the Contracting Parties or destined to be imported into its territory.
(d) The above provisions shall not, however, apply to the grant, or continuance of any :
(i) advantages accorded by either Party to contiguous countries for the purpose of facilitating frontier traffic;
(ii) preferences, or advantages accorded by either Party to any country, as existing on the Ist October, 1957 or in replacement of
such preferences or advantages that existed prior to the 15th August, 1947;
(iii) advantages resulting from any agreement for the establishment of any customs union or free tariff area to which the Government
of Czechoslovakia or the Government of India may become a party.
The export of goods from Czechoslovakia to India and from India to Czecholovakia during the period of validity of the present Agreement
will be carried out in accordance with the attached Schedules 'A' and 'B' the details of which will be agreed upon between the two
Governments for every calendar year.
The Schedules 'A' and 'B' can be extended, altered, or renewed by letters, exchanged between the two Parties by the end of each calendar
The import and export of the goods stipulated in Aritcle III, will be carried out in accordance with the export, import and foreign
exchange, regulations in force in either country and on the basis of contracts to be concluded between the Czechoslovak Foreign Trade
Corporations on the one side and the Indian physical and juridical parties, including Indian State-owned Organisations, on the other.
Both Governments will render all possible assistance for the export and import of the goods mentioned in the Schedules Wand `B' as
well as for the goods to be exported and imported under the transactions referred to in Article 111.
I. All payments of a commercial and non-commercial nature between
physical and juridical persons residing in India and Physical and juridical persons residing in Czechoslovakia as well as any other
payments on which agreement will be reached between the Reserve Bank of India and the State Bank of Czechoslovakia (Statni banka
ceskoslovenska) will be effected in non-convertible Indian Rupees.
2. For the purpose of effecting the aforementioned payments
(a) The State Bank of Czechoslovakia acting as the agent of the Government of Czechoslovakia will continue to maintain a Central Account
with the Reserve Bank of India, while the State Bank of Czechoslovakia will maintain one or more current account(s) with one or more
commercial bank(s) in India authorised to deal in foreign exchange.
(b) The Central Account will be used for depositing rupee balances and for replenishing the accounts with commercial bank(s) while
the accounts with the commercial bank(s) will be used for all other operations.
3. (a) The Central Account will be replenished by transfer of funds from the accounts with commercial bank(s) and by receipts on account
of technical credit.
(b) The accounts with commercial bank(s) will be replenished by transfer of funds from either similar accounts and from the Central
4. (a) Payments permitted under the Czechoslovak Exchange Control Laws to be made by the residents of Czechoslovakia to the residents
of India will be effected by debiting the amount of such payments to the said accounts with Indian Commercial Bank(s).
(b) Payments permitted under the Indian Exchange Control
Laws to be made by the residents of India to the residents of Czechoslovakia will be effected by crediting-, the amount of such payment
to the above mentioned accounts with Indian Commercial bank(s).
5. The details in regard to the procedure for the operation of the Central Account will be mutually agreed upon between the Reverse
Bank of India and the State Bank of Czechoslovakia at the earliest practicable date.
6. Any balances in the Rupee Accounts of the State Bank of Czechoslovakia or any debt of the State Bank of Czechoslovakia in connection
with the grant of technical credit will, upon expiry of this Agreement, be used during the ensuing 12 months for the purchase of
Indian or Czechoslovak goods as the case may be. After the expiry of this period of 12 months, any balances outstanding will be settled
in such a way as may be agreed upon between the two Parties.
7. Payments arising from contracts concluded during the validity and falling due after the expiry of this Agreement shall be effected
in Indian rupees, which will be utilised for the purchase of Indian or Czechoslovak goods as the case may be.
Both signatory Countries agree to utilize ships of the respective countries on basis of competitive freight rates and conditions to
the maximum possible extent in the transport of the goods that may be exported or imported under the present Agreement.
In order to facilitate the implementation of this Agreement, the two Contracting Parties agree to consult each other at the request
of either. Party in as short a time as possible in respect of matters connected with trade and payments between the two countries.
The two Governments will endeavour to establish and promote close cooperation in the fields of science and technology with a view
to achieve close economic relations between the two countries.
The present Agreement will come into force with effect from 1st January, 1961 and shall remain in force for a period of 3 years.
DONE in Prague on 3rd November 1960 in two originals in the English language, both texts being equally authentic.
Sd/- K. R. F. KHILNANI
On behalf of the Government of India
Sd/- F. HAMOUZ
On behalf of the Government of the Czechoslovak Socialist Republic
LIST OF SOME OF THE GOODS AVAILABLE FOR EXPORT FROM CZECHOSLOVAKIA TO INDIA
1. Complete industrial plants 2. Diesel engines, namely Marine type, and spare parts for diesel engines S. Pumps driven by diesel
engines or electricity 4. Welding machines and Transformers 5. Hydraulic presses for workshops 6. Diesel generating sets 7. Sheet
glass 8. Domestic glassware 9. Various sorts of papers including newsprint 10. Cellophane papers 11. Zip fasteners 12. Laboratory
and technical glassware 13. Various metal goods, including tailors'and bag makers' requisites 14. Shoemakers requisites, including
shoe grindery 15. Smokers requisites 16. Buttons 17. Needles of all sorts 18. Montana wax 19. Dyestuffs 20. Saccharin 21. Toys, namely
educational 22. Rangolite 23. Ammonium Hydrofluoride 24. Potassium Permanganate 25. Lithophone 26. Ultramarine blue 27. Glazes, frits,
colours and enamels 28. Laboratory chemical 29. Other chemical products 30. Plushes 31. Felts, 32. Woollen and cotton knitted goods
33. Haberdashery, millinery, drapery and apparel 34. Caps and fezes 35. Machine tools and tools for metal working and spare parts
thereof 36. Agricultural tractors with accessories and spare parts 37. Agricultural implements and spare parts 38. Textile machines
and spare parts 39. Graphic Machinery 40. Mechanical and Hydraulic paper cutting machines 41. Cigarette producing machinery 42. Tobacco
machinery 43. Electrical insulators 44. Component parts of wireless reception instruments and apparatus 45. Electricity meters 46.
Telephone exchange 47. Medical and dental apparatus and instruments 48. Sporting and hunting arms and ammunition 49. Typewriters,
Calculating machines and spare parts 50. Offset printing machines, rotaprint and spare parts 51. Statistical machines 52. Domestic
sewing machines and parts 53. Industrial sewing machines and parts 54. Photographic and motion pictures, cameras and appliances 55.
Microscopes and optical lenses 56. Spectacle frames and sun glasses 57, Water meters 58. Geodetic instruments 59. Pneumatic tools
60. Bearings 61. Precision tools 62. Spare parts for motor cars 63. Motor cycles and spare parts 64. Bicycles and spare parts 65.
Laundry machines 66. Refrigerators 67. Motor car equipment 68. Domestic hardware 69. Food machinery 70. Electrical kitchen appliances
71. Industrial and street lighting fittings 72. Vacuum flasks 73. Cast iron enamelled bath tubs 74. Industrial leather belting 75.
Industrial rubber belting 76. Fibre boards, hardboards 77. Musical instruments 78. Textile accessories 79. Pencils, graphites 80.
Stationery and office equipments 81. Bottled beer 82. Canned fruits and vegetables 83. Thermal product84. Prints, engravings, and
pictures, including photos, graphs and postcards, books and playing cards 85. Gramophone needles and components parts 86. Household
china and porcelain 87. Sanitary earthenware 88. Asbestos cement goods 89. Abrasive materials 90. Wall tiles 91. Iron and steel wire
netting 92. Panel pins and common wire nails 93. Ship chains, dog and ox chains 94. Glass jewellery, glass chatons and beads (pearls)
95. Condensed milk 96. Hops and Malts 97. Dried milk products 98. Plastics and artificial leather 99. Art silk goods 100. Road building
machinery including rollers and excavators 101. Building machinery 102. Narrow gauge diesel locomotives 103. Stone-grinding machinery
104. Screw presses 105. Battery lorries, 106. Films, exposed.
LIST OF SOME OF THE GOODS AVAILABLE FOR EXPORT FROM INDIA TO CZECHOSLOVAEIA
1. Tea 2. Coffee 3. Tobacco 4. Tobacco manufactures, i.e. cigars and cigarettes 5. Spices 6. Pepper 7. Cashew kernels 8. Cashew nuts
and cashew shells 9. Opium 10. Jams, chutnies and pickles 11. Fruit squashes and sauces 12. Canned fruit and meat products 13. Linseed
oil 14. Tapioca and its products 15. Castor oil 16. Hydrogenated oils including vanaspati 17~ Essential oils (Sandalwood oil and
lemongrass oil) 18. Groundnut oil, 19. Cottonseed oil 20. Iron ore 21. Deoiled cakes 22. Manganese ore 23. Kyanite 24. Ilinenite
25. Mica 26. Semi-processed and processed skins, hides and finished leather 27. Sheep Casings 28. Tanned hides and skins 29. Fish
meal 30. Fish and prawn 31. Myrobalan and myrobalan extracts 32. Tragazanth (gum adaragant) 33. Bristles 34. Fibres for brushes and
brooms 35. Animal hair, 36. Hemp other than raanila, sisal and aloe., 37. Flax linen 38. Cotton waste 39. Silk and artificial silk
waste 40. Wool waste 41. Woollen carpets and rugs 42. Cotton and woollen textiles including woollen goods 43. Silk and rayon textiles
and manufactures 44. jute manufactures 45. Coir and coir manufactures 46. Cordage and rope 47. Leather and leather goods including
shoes 48. leather cloth 49. Linoleum 50. Felt base floor coverings 51. Toilet and washing soap 52. Methylated spirit 53. Paraffm
wax 54. Bees wax 55. Shellac and shellac based products 56. Glycerine 67. Shark liver oil 58. Musk 59. CIternical products Sodium
bichromate Potassium bichromate Magnesium chloride Strychnine Morphine Napthalene Sodium bromide and potassium bromide Liquid brornide
Calcium chloride Crude herbs Nuxvomica Senna pods and leaves Chireta Gummi indicun Indian squill (Scilles) 60. Paints and lacquers
61. Hardware 62. Sports goods, 63. Cottage industry products, e.g. handloorn fabrics (cotton and silk), brass and bidri products,
ivory articles, wood carvings, etc., 64. Plastic manufactures and semi-manufactures 65. Plywood and other wood manufactures 66. Sewing
machines 67. Electric fans like exhaust fans/cabin fans 68. Diesel engines 69. Locks and padlocks 70. Textiles machinery and components
71. Films (exposed) 72. Books and periodicals
Praha, 3rd November, 1960
Dear Mr. KHILNANI,
In the course of our discussions concerning the Trade and Payments Agreement between our two countries, we have also discussed the
question of the Trade Representation of the Czechoslovak Socialist Republic in India, which had been established on the strength
of the Agreement contained in a letter forming an-integral part of the Indo-Czechoslovak Trade Agreement, dated the 17th November,
1953 and successive letters exchanged between the Embassy of the Czechoslovak Republic in India and the Ministry of Commerce and
Industry, Government of India.
During our discussions it had been agreed that the above arrangements have been found useful and therefore the validity of these documents
shall be prolonged for such time as the Trade and Payments Agreement to which this letter forms an integral part shall be valid.
The following are the documents I am referring to
(1) Letter dated the 17 November 1953, concerning agreement pertaining to the establishment of the Trade Representation of the Czechoslovak
Republic in India, exchanged between the Chairman of the Czechoslovak and Indian Trade Delegations.
(2) Letter dated the 29th September 1954 exchanged between the Czechoslovak Embassy in India and the Ministry of Commerce and Industry,
Government of India.
(3) Letter dated the 20th January 1956 exchanged between the Czechoslovak Embassy in India, and the Ministry of Commerce and Industry,
Government of India.
I shall be glad if you will kindly confirm that the above sets out correctly the understanding reached between us.
Sd/- F. HAmouz
First Deputy Minister of Foreign Trade,
Government of the Czechoslovak Socialist Republic.
Mr. K.R. F. KHILNANI,
Joint Secretary to the Government of India, Ministry of Commerce and Industry, New Delhi, Camp Praha.
(Letter in confirmation is not reproduced.)