With bilateral consultations between India and the European Union (EU) failing to break the logjam over the latter’s safeguard duties on Indian steel exports, New Delhi has proposed to “retaliate in equal measure,” and signalled to collect over $1.1 billion as duties from EU firms.
In a communication to the World Trade Organisation (WTO), India said it would either impose extra duties on imports or withdraw trade concessions for the 27-member bloc, in its proposed counter-move.
“India hereby informs that from 2018 to 2023, the safeguard measures (of the EU) have resulted in cumulative trade loss for India to the tune of $ 4.412 billion on which the duty collection would be $1.103 billion… Accordingly, India’s proposed suspension of concessions would result in an equivalent amount of duty collected from products originating in the EU,” India said in a notification to the world body, arbiter of such disputes. “The proposed suspension of concessions or other obligations will take the form of an increase in tariffs on selected products originating in the EU,” India told the WTO”s Council for Trade in Goods. “To ensure the effective exercise of its right to suspend substantially equivalent concessions or other obligations, India reserves its right to effectuate the proposed suspension immediately and adjust the products as well as the tariff rates,” as per the notification.
The EU has extended the safeguard duties on steel imports, which were expiring in June, by another two years till 2026. This is the second extension of the safeguards that take the form of Tariff Rate Quota (TRQ) and were first imposed in 2018. With the latest extension the safeguard would have run for eight years.
Under the TRQ mechanism every country is issued a quota for export of 26 steel products to the EU. This quota was fixed at 105% of the average imports between 2015 and 2017 from that country. Any exports beyond this quota attract extra 25% duty.
India is one of the countries affected by this measure as it has a substantial interest in steel exports to the EU. Last financial year India’s exports to the EU of iron and steel and their products was $ 6.64 billion up from $ 6.1 billion in 2022-23.
From: financialexpress
Financial News
