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The Centre is likely to further postpone the implementation of retaliatory tariffs against the US, which had been proposed in response to the ‘wrongful’ application of discriminatory duties by the latter on steel and aluminium exports from India.
“The Commerce Ministry is planning to ask the Revenue Department to come up with a notification delaying the duties for some time,” a government official told BusinessLine .
If the implementation of retaliatory tariffs — worth an estimated annual $241 million against 29 products exported from the US to India — gets deferred again, it will be the second postponement after the duties were announced on June 20 this year with an implementation date of August 4.
On August 3, the Revenue Department had issued a notification delaying the duties by 45 days. “The idea behind the proposed delay this time is to give trade officials from both sides yet more time to sort out the issue of higher tariffs of 25 per cent on steel and 10 per cent on aluminium imposed by the US on exports from India. New Delhi wants to avoid getting into a tariff war with Washington to whatever extent possible,” the official said.
The higher tariffs on steel and aluminium imports were applied by the US earlier this year on a handful of countries including India, China, Japan, South Korea, Canada, the EU, Turkey and Russia citing security concerns.
New Delhi, which has also taken up the matter with the WTO, has been arguing that the higher duties imposed are unfair as India’s exports of these items were much lower than others such as China and South Korea, and it doesn’t pose a security threat to the US.
Interestingly, a number of countries including China, the EU, Turkey, Canada and Mexico have already imposed retaliatory tariffs against goods imported from the US.
India has time till Tuesday to decide either way. “The Commerce Ministry has time till Tuesday to convince the Revenue Department to come up with a new notification with a fresh date for implementation of the retaliatory duties. We are hopeful of attaining our objective,” the official said.
Pact elusive
The teams from the Commerce Ministry and the US Trade Representative’s office, however, are nowhere near sorting out the issue of penal tariffs on aluminium and steel. “India is continuing to insist that the ideal solution is the complete rollback of the additional duties, but the US is not ready to consider it,” the official said.
The talks are still on with both sides hopeful of reaching a mutually acceptable decision soon, he added.
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