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In its attempt to avoid a tariff war with the US, India plans to put off implementation of retaliatory import duties of $241 million against 29 products from the US by another month-and-a-half.
“The Department of Commerce has suggested to the Department of Revenue that the notification on retaliatory duties against the US be amended to extend the date of implementation by 45 days, beyond August 4,” a government official told BusinessLine.
The retaliatory duties had been mooted to neutralise the effect of the additional import duties imposed by the US on Indian steel and aluminium to the tune of 25 per cent and 10 per cent, respectively. The US had cited reasons of national security for the levy.
While India had notified higher duties on US import items, including almonds, apples and certain steel products on June 20, it had put off implementation to August 4 as it hoped to sort out the matter with the US in the interim.
“While the office of the US Trade Representative (USTR) had two rounds of dialogue with Indian officials, a compromise could not be reached. The government is now hoping that the issue can be resolved in the next 45 days,” the official added.
India and the US are also scheduled to hold their strategic 2+2 dialogue next month, and the Ministry of External Affairs is keen that ties between the two nations not be soured prior to that, another official said.
External Affairs Minister Sushma Swaraj and Defence Minister Nirmala Sitharaman will host US Secretary of State Michael R Pompeo and US Secretary of Defence James Mattis in New Delhi on September 6.
The Steel Ministry, which is also involved in the discussions with the USTR, had first proposed that the US completely roll back the penal duties on aluminium and steel, and later suggested that the Donald Trump administration could impose curbs on the quantity of imports, instead of the additional duties. Both proposals were rejected by the USTR, according to government officials involved in the discussions.
Five WTO members — the EU, China, Mexico, Canada and Turkey — which are also at the receiving end of higher US import duties on steel and aluminium, have already imposed retaliatory duties. These tariffs amount to a total of $2.85 billion, according to the USTR.
New Delhi has contended that the levy on Indian steel and aluminium is unfair as the country’s export of these items to the US was much lower than that of many countries, and did not pose a security threat.
Waiver on Russia
The US Senate has passed a Bill that gives India a partial relief from sanctions against Russian firms and oligarchs, allowing it to keep buying Russia-made weapons in a landmark decision.
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