Policy

India proposes retaliatory duties against EU for restrictions on steel

Amiti Sen New Delhi | Updated on September 01, 2021

The EU had implemented tariff rate quotas on steel imports as a safeguard measure in 2018   -  istock.com/mady70

Submits to the WTO that duties would stay till the bloc removes import quota restrictions on steel

India proposed to impose additional import duties worth €292 million on select products from the European Union (EU) as a retaliation against quota restrictions put in place by the bloc on steel imports from the country. New Delhi has submitted to the World Trade Organisation (WTO) that it would shortly provide details of the measures it plans to put in place, according to an official tracking the matter.

“India estimated that the safeguard measures have resulted in the decline of exports to the tune of €1.168 billion on which the duty collection would be €292.01 million. Accordingly, India’s proposed suspension of concessions would result in an equivalent amount of duty collected from products originating in the EU,” according to the country’s submission to the Committee on Safeguards at the WTO.

Tariff rate quotas

The EU had implemented tariff rate quotas (TRQs) on steel imports as a safeguard measure in 2018 following the US decision to impose additional import duties on steel from a number of countries including Russia, India and Turkey. It fixed specific quotas for steel imports for exporting countries beyond which the items attracted additional import duties of 25 per cent. The main reason behind the TRQs was to avoid diversion of exports from the US market to the EU market.

Subsequently, the EU came up with some changes in the TRQ administration that made the situation tougher for Indian exporters as they had tailored their exports as per the initial measures announced, the official said.

“Since the EU did not roll back the measure after discussions with India on the matter, New Delhi decided that it was justified to suspend concessions to the EU by increasing duties on imports from the region equivalent to the duties calculated on the affected Indian exports,” the official explained.

The items from EU on which higher imports would apply will be disclosed to the WTO before they are applied, the official pointed out.

“The suspension of concessions and other obligations will continue to apply until the safeguard measures of the EU are lifted,” the submission added.

India is among the main steel exporters to the EU which also includes China, Russia, South Korea, Turkey and Ukraine.

Published on September 01, 2021

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