The World Trade Organization’s Dispute Settlement Body (DSB), in a special session on Wednesday, will consider a joint request made by India and the EU for more time to sort out their dispute related to import tariffs imposed by India on select ICT products, including mobile phones. 

Both members, in a submission to the DSB, requested that it should put off adoption of the WTO panel’s report, which ruled against India’s tariffs, till September 19, 2023.

60-day time period

“The DSB already allowed more time to Chinese Taipei and India to sort out the matter in the dispute on the same issue. So, it is expected that it will agree to do so in the case of EU as well. But this is mostly unprecedented as the DSB usually sticks to its 60-day time period for adoption of dispute panel reports. It is within this time frame that appeals against the judgment can be filed at the Appellate Body by the members involved failing which the report gets adopted,” a former trade official told businessline.

The matter may be settled between the EU and India with India offering some concessions in other areas to the bloc. “Since both are also engaged in Free Trade Agreement (FTA) negotiations, there may be a number of avenues that the two could explore,” the official said.

On April 17, the dispute settlement panel of the WTO, in three separate disputes filed by the EU, Japan and Chinese Taipei against India’s import duties on certain ICT products, had ruled that the tariffs violated its commitment under multilateral trade rules and needed to be corrected.

India has a 60-day time period to appeal against the judgment, failing which the report was to be adopted. The 60-day period is to end this week.

“India has already appealed to the WTO Appellate Body against the judgement in its dispute with Japan. In case of the dispute with Chinese Taipei, both sides have bought more time. If the DSB agrees to do the same with the EU, then the adoption of the panel reports in all three cases would not happen this week,” the source pointed out.

The dispute

In the dispute, all three complainants stated that India had imposed import tariffs on ICT products such as mobile phones and base stations despite its obligation to impose zero tariffs under the IT agreement.

 India’s argument is that the items on which it has imposed duties are not covered under the pact and the complainants were trying to take advantage of a technical error made by the country while updating its tariff lines.

In the last DSB meeting, Japan had expressed its disappointment with India for appealing against the panel ruling at the WTO Appellate Body which is presently dysfunctional because of US’ refusal to support appointment of judges. Appeals filed at the Appellate Body would stay suspended till the issue of its reforms is resolved and judges get appointed.

“Settling the issue bilaterally without India approaching the Appellate Body would suit both the EU and Chinese Taipei as that way the members could hope to get some results,” the official said.