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India, EU navigate WTO dispute on ICT duties amid FTA negotiations
Industry News- Dec 14,23
The EU has requested duty concessions from India on these goods, citing violations of global trade norms. However, India asserts that such concessions can only be discussed within the context of the free trade agreement (FTA).
India aims to address a WTO import duty dispute with the European Union regarding specific information and technology products through an ongoing free trade agreement negotiation, according to an official statement to news agency PTI.
Following a World Trade Organisation (WTO) dispute panel ruling on April 17, stating that India's import duties on certain information and technology (ICT) products violate global trading norms, discussions are underway between India and the European Union to find an amicable resolution outside the WTO framework.
The EU has requested duty concessions from India on these goods, citing violations of global trade norms. However, India asserts that such concessions can only be discussed within the context of the free trade agreement (FTA) and not on a most-favored-nation (MFN) basis. Under MFN rules, a WTO member cannot grant import duty concessions to specific countries or regions, as it would breach global trade regulations.
The official clarified, "They are seeking duty concessions, which, according to India, can be discussed only under the free trade agreement (FTA). India can consider something under the FTA, but not on MFN (most favored nation) basis."
India is facing challenges in reducing duties on these items due to its focus on promoting domestic manufacturing of electronic goods and has implemented a production-linked incentive scheme to support the manufacturing of various IT hardware products within the country.
The European Union, along with Chinese Taipei, has urged the WTO's dispute settlement body not to adopt the panel's ruling against India, allowing the countries to resolve the ICT duty dispute mutually. The dispute originated when the EU challenged India's introduction of import duties on a range of ICT products in 2019, leading to additional involvement from Chinese Taipei and Japan.
While India has recently resolved its WTO trade disputes with the United States through mutual agreements, the current impasse with the EU reflects the challenges in navigating global trade dynamics and adhering to domestic economic priorities.
Source: Mint
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