WTO steel row: Why the hurry, India asks Japan

Amiti Sen New Delhi | Updated on January 15, 2018 Published on April 04, 2017

The safeguard duties imposed by India to protect the domestic industry against cheap imports is being slowly tapered.   -  BL

12 other countries including US, Korea, China reserve third party rights in dispute

India has objected to Japan’s request to the World Trade Organisation (WTO) to put in place early time frames for a “prompt’’ resolution of its dispute against India’s penal duties on steel imports.

New Delhi has argued that there is no rationale for treating this dispute any more urgently than other WTO disputes it was involved in and the same standard should be applied to all disputes.

“Japan may be in a hurry as the safeguard duties are to be removed next year and it wants a resolution before that. But that is not a valid reason for changing timelines,” an official told BusinessLine.

It generally takes around 18-20 months for settling a dispute at the WTO, but according to WTO rules, in cases of urgency, including those which concern perishable goods, the parties to the dispute, panels and the Appellate Body make every effort to accelerate the proceedings to the greatest extent possible.

The dispute settlement body of the WTO, on Monday, agreed to Japan’s request for setting up a dispute settlement panel to determine whether India's decision to impose a provisional and then definitive safeguard measure on imports of iron and steel products violate WTO rules.

India imposed safeguard duties-penal duties to protect vulnerable domestic industry against a surge in imports — on hot-rolled steel products in March 2016 fixed at 20 per cent which is being slowly tapered off but would be in place till March 2018.

Japan, in its request, reiterated that India’s safeguard measures in question were inconsistent with its obligations at the WTO and since the measures will expire on March 13, 2018, it hoped the new panel would observe the time frames specifically prescribed in the WTO’s Dispute Settlement Understanding for the purpose of a prompt resolution of the dispute.

India said it explained to Japan that the measures in question were wholly consistent with WTO rules and justified by special circumstances. It added that there was no justification to give special treatment to this case.

Japanese government has reportedly estimated that the tariffs could cost Japanese steel companies about $220 million through March 2018.

The safeguard duties imposed by India gave rise to complaints from several other WTO members. Interestingly as many as 12 members including the US, Australia, Canada, the European Union, Korea, Kazakhstan and Vietnam have submitted requests to have third party rights in the dispute.

Having third party rights entitles the member to have access to reports submitted by both parties in the dispute and also allows them to give comments.

Published on April 04, 2017

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