India proposed the imposition of retaliatory duties against the US on Friday under WTO norms over American tariffs on the automobile sector on the pretext of safeguard measures.
“The proposed suspension of concessions or other obligations would take the form of an increase in tariffs on selected products originating in the United States,” according to a notification of the WTO being circulated at India’s request. India has notified the WTO’s Council for Trade in Goods of its proposed suspension of concessions and other obligations under certain WTO provisions. “This notification is made in connection with safeguard measures extended by the USA on imports of automobile parts from India,” it said.
On March 26, the US had adopted a safeguard measure in the form of a tariff increase of 25 per cent ad valorem on imports of passenger vehicles and light trucks and on certain automobile parts from India. The measures on automobile parts apply from May 3 for an unlimited duration. Though not notified by the US to the WTO, they are said to be safeguard measures.
India has contended that the measures taken by the US are not consistent with the General Agreement on Trade and Tariff (GATT) 1994 and the agreement on Safeguards. “As consultations sought by India on these tariffs have not taken place, India reserves the right to suspend concessions or other obligations,” it said.
The safeguard measures would affect America’s $2,895-million imports of products originating in India, on which the duty collection would be US $723.75 million. “Accordingly, India’s proposed suspension of concessions would result in an equivalent amount of duty collected from products originating in the United States," India maintained.
The development assumes significance, considering that India and the US are actively negotiating an interim trade agreement to boost trade ties. India had taken similar measures last month against the US tariffs on steel and aluminium.
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