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Current Affairs

EU launches WTO case against India over import duties on ICT products

Date: 03 April 2019 Tags: External Sector

European Union (EU) has filed complaint against India at World Trade Organisation’s (WTO) dispute settlement mechanism over imposition of import duties on wide range of ICT products. It has requested consultations with Indian government under WTO rules governing settlement of disputes in this regard.

EU Complaint

  • Challenges introduction of import duties by India on wide range of ICT products ranging from 7.5 to 20%.
  • Imposition of import duties goes against India’s earlier legally binding commitment in WTO to allow duty free trade in ICT products.
  • It is affecting EU significant economic interest as it exports ICT products worth 600 million per year to India.
  • It is undermining competitiveness of European ICT companies which supports hundreds of thousands of high value jobs across Europe.

Background

India had hiked import duty on certain information, communication and technology (ICT) items including mobile phones and components, base stations, integrated circuits and optical instruments in October 2018.  It was hiked as part of Government’s efforts to check widening current account deficit (CAD) by curbing unnecessary imports.

Seeking consultation is first step of dispute settlement process under WTO international trade regime. If consultations requested does not result in satisfactory solution, then EU can request that WTO set up panel in case to rule on raised issue.