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India and seven others have come in support of China in its fight against the US proposal to impose $50 billion of retaliation tariffs unilaterally on Chinese imports for its alleged violations of intellectual property rights (IPR) rules as per the US government’s ‘Section 301’ investigations.
New Delhi, which has been placed on the ‘priority watch list’ by the US for many years in its Section 301 investigation report on IPR issues, said such unilateral actions by the US could lead to a trade war, a Geneva-based official told BusinessLine .
The observations were made at a recent meeting of the Dispute Settlement Body (DSB) of the World Trade Organisation (WTO) where China registered its official complaint against the US’s Section 301 conclusions and the proposed retaliatory tariffs.
“We have always criticised attempts made by the US to put pressure on its trading partners, including India, to change their IPR laws even when these are in compliance with the WTO’s Trade Related Intellectual Property Rights (TRIPS). Such unilateral action is against multilateral trading norms and must be discouraged,” a government official said.
The Donald Trump government in the US, over the last year, has taken a number of trade related measures against its trading partners, including China and India, which have undermined the multilateral ruled-based regime of the WTO.
Besides India, seven other countries criticised the US move proposing sanctions against China without going through a dispute settlement process. These include the EU, Russia, Pakistan, Norway, Brazil, Hong Kong, Chinese Taipei and Japan.
India features in the ‘priority watch’ list of countries of the US 301 report brought out annually, which indicates that the US feels that it has “serious intellectual property rights deficiencies” and does not give adequate protection to American companies. It is just a step away from being classified as a ‘priority country’ which could lead to retaliatory measures as per US laws.
China’s stance
“The unilateral nature of Section 301 is being revived and is now challenging the foundation of the rules-based multilateral trading system. It is time for members to join together to take actions against the unilateralism and protectionism manifested in the US conduct,” China said in its submission to the DSB. In its comments at the DSB, India said the multilateral system embodied in the WTO has served members well and that adoption of unilateral measures will erode the system and risk provoking a full-blown trade war.
Both Chinese Taipei and the EU said they shared the concerns of the US regarding protection of intellectual property rights in China but that the best way to address the matter was through the multilateral trading system; Brazil also said that the way to resolve such issues was through the WTO’s dispute settlement system.
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