LIIofIndia Home | Databases | WorldLII | Search | Feedback

Indian Treaty Series

You are here:  LIIofIndia >> Databases >> Indian Treaty Series >> 1963 >> [1963] INTSer 19

Database Search | Name Search | Recent Treaties | Noteup | LawCite | Help



New Delhi, 22 November 1963

The Government of India and the Government of the Hungarian People's Republic;

NOTING with satisfaction the successful development of economic and trade relations;

DESIROUS of further increase and diversification in trade; and

HAVING agreed on further strengthening of economic co-operation between the two countries;

HAVE agreed as follows

Article I

I. 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. 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; however, for this purpose payments of a non-commercial nature will also be included. Further, for this purpose, and for periodic reviews, imports and exports whether on deferred payment terms or on cash basis, relating to the contracts concluded and to be concluded on the basis of this and earlier Indo-Hungarian Trade Agreement as well as payments of a payments are made.

Article II

The Contracting Parties will accord upon importation and exportation of goods from one country to the other maximum facilities allowed by their respective laws, rules and regulations. In any case the said goods shall enjoy full most-favoured-nation treatment with respect to customs duties and charges of any kind imposed on imports or exports or in connection therewith, with respect to the methods of levying such duties and charges, with respect to rules, formalities and charges in connection with customs clearing operations, and with respect to the application of internal taxes or other charges of any kind imposed on or in connection with imported goods.

The Contracting Parties will accord to each other in respect of the issuance of import and export licences treatment no less favourable than that granted to any other country.

Article III

Any advantage, favour, privilege or immunity granted by either of the Contracting Parties to import or export of any product originating in the territory of a third country or destined for its territory, shall be accorded 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.

Article IV

The provisions of Article II and III shall not, however apply to the grant or continuance of any

(a) advantages accorded by either Government to contiguous countries with purpose of facilitating frontier traffic;

(b) preferences or advantages accorded by India to any third country and existing on 17th June, 1954 or in replacement of such preferences or advantages that existed prior to the 15th of August, 1947.

Article V

Juridical and physical persons of either Contracting Party shall enjoy the most-favoured-nation treatment in respect of personal protection and protection of property when effecting commercial activities in the territory of the other Party provided that the laws and regulations of such other Party which are generally applicable to all foreigners alike.

Article VI

The exports of goods from Hungary to India and from India to Hungary 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 from time to time.

The Schedules 'A' and S' can be extended or altered by mutual consent of the two Parties at any time during the validity of this Agreement.

Article VII

The import and export of the goods stipulated in Article VI 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 Indian physical and juridical Parties, including Indian State-owned Organisations, on the one side and the Hungarian Enterprises on the other.

Article VIII

The provisions of the present Agreement do not affect the rights of the Indian and the rights of the Hungarian physical and juridical parties, subject to the import, export and foreign exchange regulations in force in both the countries, of concluding commercial transactions concerning the import or export of goods not included in Schedules 'A' and V.

Article IX

Both Governments will render all possible assistance for the export and import of the goods mentioned in the Schedules 'A' and 'B', as well as for the goods to be exported and imported under the transactions referred to in Article VIII.

Article X

1. All payments of a commercial and non-commercial nature between physical and juridical persons residing in India and physical and juridical persons residing in Hungary as well as any other payments on which agreement will be reached between the Reserve Bank of India and the National Bank of Hungary will be effected in non-convertible Indian Rupees.

2. For the purpose of effecting the aforementioned payments

(a) The National Bank of Hungary Will continue to maintain a Central Account with the Reserve Bank of India, while the National Bank of Hungary and/or the Hungarian Foreign Trade Bank Limited 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 other similar accounts and from the Central Account.

(c) The Central Account mentioned in (2) above will be operated upon by the National Bank of Hungary while the accounts with the commercial bank(s) will be operated upon by the National Bank of Hungary and/or the Hungarian Foreign Trade Bank Limited, as the case may be.

4. (a) Payments permitted under the Hungarian Exchange Control Laws to be made by the residents of Hungary 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 Hungary will be effected by crediting the amounts of such payments 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 Reserve Bank of India and the National Bank of Hungary at the earliest practicable date.

Hungary or any debt of the National Bank of Hungary 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 Hungarian 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. The provisions of this Agreement will continue to apply to the payments arising from contracts concluded during the validity and falling due after the expiry of this Agreement, as well as to the purchases of those Indian or Hungarian goods and commodities for which these payments are utilised. The period of 12 months referred to in para 6 above shall be counted from the dates the said payment is made.

Article XI

(a) The Contracting Parties agree that, in exercise of their rights of shippers' preference they shall, to the maximum extent possible, utilise the vessels owned or chartered by shipping organisations of the two countries concerned for shipping cargoes imported or exported under this Agreement, on the basis of world competitive freight rates and conditions.

(b) Mercantile ships of either country with or without cargoes therein, will, while entering, staying in or leaving the ports of the other country, enjoy the most favoured facilities granted by their respective laws, rules and regulations to ships under third countries' flags. This principle shall not, however, apply to ships engaged in coastal navigation.

Article XII

In order to facilitate the implementation of this Agreement, the two Contracting Parties agreed to consult each other at the request of either Party in as short a time as possible, but not later than forty-five days from the date of the receipt of request, in respect of matters connected with trade and payments between the two countries.

Article XIII

The legal capacity and disposing power of the individuals and legal persons of India as well as those of Hungarian People's Republic shall be judged in conformity with the laws of that State of which formed.

The natural and legal persons of both Contracting Parties shall have the right to act either as plaintiffs or as defendants at the Courts of Justice of the other Party.

For the meeting of an obligation assumed by natural and/or legal persons of the Contracting Parties other natural or legal persons can only be made liable on the basis of a definite legal provision to this effect or of an explicitly written undertaking of obligation. Accordingly, for the liabilities of any State-owned Undertaking or other legal person ' in the absence of a specific provision, neither the State nor any organ or other Undertaking of it shall be held responsible.

Article XIV

The national and legal persons of India and the legal persons of Hungarian People's Republic may agree that legal disputes arising from contracts concluded in commercial or other economic matters shall be referred to arbitration. The arbitration agreement must be made out in writing. Such an agreement shall bar the jurisdiction of the courts of the Contracting Parties.

Article XV

The two Governments will endeavour to establish and promote close cooperation in the fields of science and technology between the two countries.

Article XVI

The present Agreement will come into force with effect from 1st January, 1964 and shall remain in force for a period of 5 years.

DONE in New Delhi on 22nd November, 1963 in two originals in the English language, both texts being equally authentic.



On behalf of the Government of India.



On behalf of the Government of Hungarian People's Republic.


1 Hydro Power Stations
2. Thermal Power Stations
3. Back pressure and extraction type turbo sets
4. Synchronous condensors
5. Equipments for air-cooled system "Neller" type
6. Equipments for Poultry farms and poultry processing machinery
7. Complete flour mills of 20, 30, 50 and 100 tons capacity as well as flour milling machinery
8. Different types of aggregates
9. Aninionia compressors and equipments for ice factories and refrigeration plants
10. Food canning factory equipments
11. Sean-dess tube mill and push benches
12. Plant for manufacturing gas cylinders
13. ACSR conductors manufacturing plant
14. Morphine, alkaloid manufacturing plant
15. Acetylene manufacturing plant
16. Oxygen gas manufacturing plant
17. Semi-automatic hollow glass factory
18. Fully automatic hollow glass factory
19. Glass tube factory
20. Sheet glass factory
21. Tempered safety glass factory
22. Splinter-proof safety glass factory
23. Glass insulating material manufacturing plant
24. Ampule manufacturing plant
25. Plant for manufacture of pre-fabricated and pre-stressed concrete railway sleepers
26. Plant for manufacture of pre-stressed concrete elements, like poles, beams, etc.
27. Electrode manufacturing plant
28. Plant for manufacturing detonators (for mines)
29. Brick manufacturing plant (mobile unit)
30. Injection needles and syringes manufacturing plant
31. Complete vacuum technical plant
32. Machinery for manufacturing incandescent lamps
33. Machinery for manufacturing special lamps and components, i.e. film studio lamps, projector amps, mercury vapour lamps, fluorescent tubes and accessories, photo-electric tubes and accessories
34. Spring washers manufacturing plant
35. Bakelite electric goods manufacturing plant
36. Factory for manufacturing balances and scales
37. Cutting tools manufacturing plant
38. Wire-netting manufacturing plant
39. Mechanical toys manufacturing plant
40. Locks and padlocks manufacturing plant
41. Continuous saponification plant
42. Drop forged tools manufacturing plant
43. Ball bearing reconditioning plant
44. Complete girders (steel structure)
45. Mobile radio transmitters-receivers system FM power output from 1 to 10 W for transmission distance of 5 to 5 0 kilometers and short waves
47. B roadcasting transmitters system FM with power output from. 25 to 3 KW with high frequency range
48. Microwaves radio, links type PM 24-28, providing 22-radio- telephone channels with Pul sephase modulation
49. Railway safety and signalling equipments
50. Pumps and pump stations for irrigation and drainage
51. Different sizes of water turbines/Mignon turbines/partly in collaboration
52. Diesel electric and hydraulic locomotives with spare parts
53. Diesel rail cars and trains
54. Sleeping and dining care with airconditioners
65. Various types of winders
56. Machinery and equipment for mines
57. Mine telephone and mine signalling equipments
68. Crushing and classifying equipment
59. Complete ore and mineral dressing plants
60. Cranes and various equipments for ports
61. Travelling crabs/licences, components and spare parts to be supplied on the basis of collaboration agreements
62 Various railway, industrial and other balances
63. Weighing bridges
64. Geophysical prospecting and drilling equipments
65, Aerial rope ways and transport machinery
66. Special types of electric industrial furnaces
67. Foundry equipment
68. Various floating cranes from 5 to 150 tons
69. Tug-boats and cargo ships
70. Machinery for the lime and cement industry
71. Complete units for the lime and cement industry
72. Apparatuses for the chemical industry
73. Machinery for the building industry
74. Glass-lined equipments and machinery for the local production of the same
75, Machine tools
76. Tractors and spare parts
77. Insulators
78. Wire-drawing and cable manufacturing machines
79. Diesel engines and generating sets
80. Machines for plastic industry
81. Water and irrigation pumps
82. Compressors/stationery and mobile/diesel and electrically driven
83. Gas producing plants
84. Grain slicing machines system Rajkai
85. Machinery for meat industry
86. Electrostatical dye spraying apparatus
87. Cheese manufacturing units/cheese mixing tubs
88. ACSR cables and conductors
89. Transmission line fittings and accessories
90. Vibration dampers
91. Lightning Arrestors
92. Electric motors, low voltage switch gears
93. Are welding sets
95. Metal-clad switchgear equipments
96. Film projectors
97. Other Kino-technical equipments
98. Radio sets and spare parts
99. Television sets and spare parts
100. Television studio equipments
101, Optical lenses and other precision goods
102. Electric supply meters and components also under collaboration scheme
103. X-Ray apparatuses for medical purposes
104. X-Ray apparatuses for industrial purposes
105. Radio receiving and transmitting valves
106, Mercury vapour lamps
107. Film studio lamps
108. Projector lamps
109. Photo-electric tubes and accessories
110. Geodetic instruments and spare parts and/components under collaboration scheme
111. Optical instruments and spare parts and /components under collaboration scheme
112. Electric instruments and spare parts and/components under collaboration scheme
113. Electronic instruments and spare parts and/components under collaboration scheme
114. Instruments and apparatuses for laboratories
115. Medical and surgical instruments, apparatuses and hospital equipments, including injection needle and syringes
116. Material testing instruments for textile industry
117. Material testing instruments for foundry industry
118. Meteorological instruments
119. Woodworking machines
120. Hardware/card clothing, screws, shoe-tacks, nails
121. Electric and blasting machines and accessories for the mining industry
122. Alarm clocks
123. Bicycle spare parts-
124. Spare parts for motor cycles under collaboration scheme
125. Dumpers and spare parts
126. Garage equipments/diesel and electric testing benches
127. Gas cylinders
128. Steel products, i.e. steel bars and sections, alloy steel
129. Steel sheets and plates
130. Ball bearings
131. Roller bearings
132. Taper bearings
133. Seamless steel tubes
134. Hard metal tips and drawing dies
135. Pharmaceutical raw materials
136. Fine chemicals
137. Pharmaceutical products in bulk
138. Pharmaceutical specialities
139. Pharmaceutical intermediates
140. Degranol
141 Medicinal herbs
142. Seras and vaccines
143. Essential oils
144. Laboratory reagents
147. Reclaimed rubber
148. Sanitary rubber goods, i.e. surgical gloves, contraceptives
149. Industrial. chemicals, i.e. industrial explosives, etc.
150. Organic chemicals
161. Inorganic chemicals
152. Photographic materials
153. X-Ray films
164, Oils and mining products, i.e. lubricating oils, basic refractory bricks and electrocast glass tank blocks, aluminiurn fluoride, bitumen, etc.
155. Artificial silk goods
166. Furnishings
157. Oil cloth
158. Cotton yarn
159. Rayon yarn
160. Sinking of shafts and related mining operations on contract basis
161. Engineering consultation, training of experts, etc.
162. Man-made fibres, such as Danulon
163. Miscellaneous goods such as feature films, documentaries, books and periodicals, didactical materials, camping beds, toys, playing cards, airguns, dolls, brushware, aluminium. trays, scissors and manicure sets, educational appliances, records, etc.
164. Equipments for alumina plants and aluminium, smelters
165. Complete units for the production of alumina and aluminium metal
166. Railway brakes different types
167. Equipments and complete units for chemical and pharmaceutical industry
168. Equipments for restaurants and buffets



1. Fruits, fresh, dried, processed and preserved and fruit juices and squashes
2. Cashew kernels
3. Pepper
4. Other spices
5. De-oiled oil-cakes including de-oiled groundnut cake meal
6. De-oiled rice bran meal
7. Decorticated and deoiled cotton seed cake
8. Canned sardines and other tinned fish
9. Groundnuts H.P.S.
10, Sheep and animal casings
11. Fish meal
12. Tea
13. Coffee
14. Tobacco
15. Shellac and shellac based products
16. Hide and skins, raw, semi-processed and tanned including raw goat skins
17. Cotton waste,
20. Myrobolan extract
21. Animal hairs including bristles
22. Mica
23. Iron ore
24. Kyanite
25. Dead-burnt magnasite
26. Vegetable oils, linseed oil, castor oil, groundnut oil
27. Rolled steel
28. Iron and steel castings and forgings
29. Steel pipes, tubes and fittings thereof

30, Ferrous metal manufactures including fabricated steel structurals, deformed steel re-inforced bars, builders, fastners, needles all sorts etc.

31. Non-ferrous, senties and manufactures

32. Internal combustion engines including diesel engines including components and ancillaries thereof

33, Centrifugal and turbine pumps
34. Exhaust fans and blowers

35. Machinery for cotton, art silk and jute textiles and components, accessories and ancillaries, thereof

36. Sugar mill machinery and components and ancillaries thereof
37. Solvent extraction plants
38. Chemical and pharmaceutical machinery
39. Cement mill machinery and components and ancillaries thereof

40. Industrial machinery n.o.s.

41. Transport equipments like motor vehicles, industrial shunters etc. and components and ancillaries thereof

42. Machine tools including lathes, shapers, drills (Pillar and Radial), planners, slotters, turret and capstan lathes, tool and cutter grinders, belt sanders, hacksaw and band saw machines

43. Foundry moulding and other foundry machines
44. Electric furnaces for both melting and heat treatment operations
45. Cutting tools
46. Small tools including steel files, hacksaw and band saw blades
47. Dies, jigs and fixtures
48. Surface coated and bonded abrasives
49. Drop forged hand tools like pliers, sprayers and wrenches
50. Batteries, dry and storage, including deafaid batteries and batteries for use in fork lift trucks
51. Electric motors, transformers and switch gear and control gear
52. Electrical wiring accessories and lighting fittings
63. Electric cables and wires
54. Railway train lighting and signalling equipments
55. Railway track fastners, fittings and accessories
56. Railway rolling stock
57. Laboratory, scientific, electrical measuring and industrial process/flow control instruments
58. Water meters
59. Razor blades and safety razors
60. Zip fastners
61. Refrigeration, air conditioning and humidifying equipment components and ancillaries thereof

62. Engineering manufactures n.o.s.

63. Cotton textiles and hosiery
64. Woollen textiles and knitted wears
65. jute manufactures

67. Jute canvas/tarpauline

68. Other textile product A n.o.s.

69. Rubber tyres and tubes
70. Cosmetics and toiletries
71. Tooth brushes
72. Cigars and cigarettes
73. Nylon socks
74. Linoleum
75. Abrasives
76. PVC leather cloth
77. Paper and paper products
78. Leather footwear
79. Finished leather and leather manufactures,
80. Sports goods
81. Plastic goods
82. Indian handicrafts and cottage industry products e.g. handloom (cotton arid silk-artistic silver, brass and bidri products, ivory articles, wood carvings, etc.)
83. Sodium and potassium bichromate
84. Magnesium chloride
85. Magnesium sulphate
86. Alumunium sulphate and alums
87. Calcium chloride and fuses
88. Ferric alumina
89. Ammonium chloride (fertiliser grade/battery grade)
90. Stearic acid
91. Gloic acid
92. Acetic acid
93. Ethyl. acid
94. Chronic acid
95. Mercuric chloride
96. Sodium bicarbonate
97. Barium carbonate
98. Sulphonated castor oil
99. Quinine
100. Emetine HC1
101. Cortisone and allied compounds
102. Strychnine nitrate
103. Bismuth salts
104. Camaquin amodiaquin
105. Sex hormones
106. Vitamin A
107. Vitamin K
108. Magnesium stearate
109. Destrin
110. Paints and varnishes
111. Glycerine, crude and refined
112. Alcohol
113. Crushed bones
114. Essential oils
115. Polyethylene
117. Potassium and ammonium alum
118. Medicinal herbs
119. Semi-precious stones/gold rings/jewelleries, Ne.
120. Books and periodicals
12 1. Films cinematographic, exposed



With reference to Article VI of the Long-term Trade and Payments Agreement between the Government of India and the Government of the Hungarian People's Republic signed in New Delhi on the 22nd November, 1963 and discussions now held in Budapest between the Indian and the Hungarian Trade Delegations, we state below the understanding reached between the two Trade Delegations.

The List of Commodities "A" and "B" attached to the above mentioned Agreement, shall continue to remain valid for the calendar year 1965.

DONE in Budapest, on the 10th November, 1964 in two originals in English language, both texts being equally authentic.


S.V. Ramaswamy
On behalf of the Government of India


On behalf of the Government of the Hungarian People's Republic



An Indian trade delegation led by the Minister of Commerce, Government of India, and a Hungarian trade delegation led by the Minister of Foreign Trade, Government of the Hungarian People's Republic, met in New Delhi between 30th March, 1968 to 4th April,1968 and discussion with the Indo-Hungarian trade.

2. A review of Indo-Hungarian trade revealed that though there was continuous increase in trade exchanges from 1960 to 1965, since 1966 there has been a slowing down of the pace of development. It was also noted that the balance of payments position of Hungary was not quite satisfactory as the debit balance of Hungary amounts to nearly Rs.100 million. A special effort was, therefore, called for from both sides for increased trade with particular emphasis on Hungarian exports to rectify the imbalance. Both sides agreed that the traditional pattern of trading had failed to bring about the mutually desired development of trade between India and Hungary and, therefore, it had become necessary to seek new possibilities for strengthening the economic co-operation between the two countries. It was agreed that there are many possibilities for strengthening the economic co-operation between the two countries.

3. In order to increase the trade exchanges in a significant manner, the Ministers agreed that the following programme of action should be initiated :

(i) The possibilities of utilising the credit of Rs. 250 million extended by the Hungarian Government should be examined in depth. Cases which are pending decision for a long time should be expedited.

(ii) the import possibilities of goods which are available in Hungary for export to India should be examined in detail. Such items should be located and necessary steps taken to ensure that supplies are made in accordance with the Trade and Payments Agreement.

(iii) In order that Hungary may continue to place orders for wagons in India on the basis of their requirements, necessary financial arrangements should be worked out. In particular, railway equipments which are available on acceptable conditions in Hungary should get high priority for imports to India both for domestic production and for export requirements.

4. It was further agreed that the two Governments will examine before the end of the year the possibilities of extending the Trade and Payments Agreement for further period taking into account the fact that the present Agreement has already been extended upto end of 1970.

5. The two Government will nominate representative including technical and other export who will meet at least once a year to study the possibilities of expansion of trade and assist in establishing all the targets for the annual exchange of commodities . The two government will further authorise these representative to examine and work out a further programme regarding:
(a) Industrial collaboration between Indian and Hungarian organisation or enterprises in India or Hungary.
(b) Joint Indo-Hungarian industrial and commercial co-operation in third markets.

6.The two minister have agreed to invite the trading organisation of the respective countries to give symphatic consideration for conclusion of long term contracts for good to be regularly exchanged between the two countries.
7.It has also been agreed upon that the implementation of the above decision and programme of action should be reviewed periodically.
8. Done in New Delhi on 4th april 1968 in two originals in the English language.

Dinesh Singh
Leader of the Indian Trade Delegation

sd/- J. Biro
Leader of the Hungarian Trade Delegation

India Bilateral

Ministry of External Affairs, India

LIIofIndia: Copyright Policy | Disclaimers | Privacy Policy | Feedback