The Hindu Business Line : US takes India to WTO on liquor duties

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New Delhi March 7 With the US taking India to the WTO for dispute settlement consultations over Customs duties on imported wine and distilled spirits on Tuesday, pressure is mounting on India to reduce its high Customs tariff on imported alcoholic beverages, as they are being construed as a major market access barrier.

On November 20, 2006 the European Union (EU) too had requested for WTO consultations over the high duties on imported spirits.

Both the US and the EU contend that on top of basic Customs duties, India slaps an additional duty and an extra additional duty on imports of wine and distilled spirits, taking aggregated duties to a high of 550 per cent against New Delhi's commitment not to exceed 150 per cent.

Reacting to these demands, the Commerce and Industry Minister, Mr Kamal Nath, conceded that New Delhi was negotiating with the US and the EU over the duties after they filed a consultation plea with the WTO.

However, he added: "Hopefully, we won't have to go to a dispute settlement panel as India does not want to take it to the dispute settlement body. I hope a solution could be found as the matter is being discussed at the highest level." He hinted at a possible cut in tariffs on imported wines and spirits in view of the growing demand from trade majors. "It (any cuts) need not be announced in the Budget. It can be done outside the Budget."

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