Economy

India opposes permanent tariff cuts at WTO to deal with pandemic

Amiti Sen New Delhi | Updated on May 17, 2020 Published on May 17, 2020

Crisis shouldn’t be used to gain market access, says New Delhi at General Council meet

India has refused to agree to permanent tariff concessions on health and farm products at the World Trade Organisation as an answer to Covid-19 trade disruptions proposed by some member countries, mostly rich. Further, it has argued that the proposal may be a ploy to gain additional market access.

At a recent meeting of the WTO’s General Council to exchange views on the economic and trade impact of the pandemic, New Delhi argued that developing countries needed to continue protecting their nascent industries. “...the narrative-push by some WTO members to seek permanent tariff liberalisation on a range of products in response to a temporary crisis appears to be a thinly veiled bid to use the crisis as an opportunity to gain market access for their exporters,” said India’s statement at the meeting.

 

Australia, New Zealand, Singapore, Canada, Chile and Brunei had come up with a joint statement a few weeks earlier against the imposition of export controls, or tariff and non-tariff barriers. They also opposed the removing of any existing trade restrictive measures on essential goods, especially medical supplies, amid the battle against Covid-19.

“Developing countries seeking to shore up manufacturing capacity in medical products will require tariff protection for their nascent domestic industry. Further, job losses in many service sectors have to be compensated elsewhere. Therefore, India, like many other developing countries, cannot agree to permanent tariff concessions, and a dilution of the tariff bindings that we have paid for in the Uruguay Round,” said India’s statement.

Members are free to reduce customs duties on imports of certain medical or agricultural products to zero if it serves their health and food security objectives, but it has to be on a voluntary basis, it added.

Uneven impact

In formulating a response to the Covid-19 disruptions, it is critical to bear in mind that the impact of the pandemic will be felt unevenly, though widely, the statement pointed out. “The strain on economic, food and livelihood security will disproportionately impact developing countries and LDCs (least developed countries) with large populations and limited resources. Therefore, they need special treatment,” India said in the statement.

However, India also acknowledges the importance of coordinating the global response to avoid disruptions in the flow of vital medical supplies, food and other goods and services across borders, and has been playing a proactive role in ensuring the availability of vital drugs such as hydroxychloroquine and paracetamol across the globe, it added.

Published on May 17, 2020

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Sincerely,

Support Quality Journalism
  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.