The WTO’s Dispute Settlement Body (DSB) has agreed to give three more months to India, the European Union and Chinese Taipei to settle issues around the adoption of a panel ruling against India’s import tariffs on certain hi-tech products including mobile phones.
“The parties asked that the DSB delay consideration of the panel reports until December 18 in order to help facilitate resolution of the disputes, the DSB agreed to it,“ a Geneva-baded trade official told businessline.
Earlier, the WTO’s DSB had given time till September 19, 2023, to the countries to resolve the issue.
On April 17 this year, a dispute settlement panelhad ruled against India’s import duties on certain ICT products, including mobile phones and base stations, in three separate disputes filed by the EU, Japan and Chinese Taipei.
The WTO panel ruled that the tariffs violated its commitment under multilateral trade rules and needed to be corrected.
In their complaints, Japan, the EU and Chinese Taipei had stated that India had imposed import tariffs on some ICT products despite its obligation to impose zero tariffs under the IT Agreement and subsequent measures taken.
India had argued that the ITA did not cover the new-age products such as smartphones and the complainants were trying to take advantage of a technical error made by the country while updating its tariff lines.
While the WTO panel ruled against India, it gave a 60-day time period to appeal against the judgment, failing which the ruling was to be adopted.
The EU and Chinese Taipei, however, did not want India to appeal to the WTO Appellate Body. This is because the body is currently non-functional due to US objection over the appointment of judges and any case brought to it would stay suspended for a long time.
“Following discussions, India, the EU and Chinese Taipei decided to try and mutually resolve the matter and asked the WTO DSB time to do the same. Since the countries could not reach an understanding by the stipulated deadline of September 19, they appealed for more time and have been granted three additional months,” the official said.
The EU has estimated that its exports of such technology affected by India’s duties is up to €600 million annually. “While this is already significant, the real impact on European companies, which also export from other countries to India, is considerably higher,” according to an EU statement issued earlier.
One of the options that India and the EU might explore to resolve the matter is through concessions offered to the bloc on the affected items as part of the bilateral Free Trade Agreement being negotiated, government sources said.
In Japan’s case, however, India decided to appeal to the Appellate Body against the panel’s verdict.
Japan said it was disappointed that by appealing the ruling against its import duties on ICT products, India had sent the case into a void and asked India to revoke the decision.