Japan joins WTO battle against India

Narendra Modi and Shinzo Abe shake hands.

New Delhi: Japan has expressed interest to join consultations in a dispute case filed by the EU in the WTO against India's import duties on some information and communications technology products, including mobile phones, according to a communication of the World Trade Organization.

Japan is the sixth country which wants to join the consultations sought by the European Union (EU) against India under the aegis of the WTO's dispute settlement mechanism.

The other countries which have requested are Canada, Thailand, the US, Singapore and Chinese Taipei.

On April 9, the EU dragged India into the World Trade Organization's (WTO) dispute settlement mechanism over Indian import duties on nine categories of information and communications technology (ICT) products, including mobile phones and components, base stations, integrated circuits and optical instruments.

They have alleged that imposition of duties infringes WTO norms as India has committed zero per cent bound tariffs on these products.

While bound tariffs or duties refer to the ceiling over which a WTO member country cannot impose import duty, the applied tariff is the duty which is currently in place.

The EU has alleged that despite India's legally binding commitment in the WTO that it would not charge any import duty on ICT products, India has been applying duties ranging from 7.5 per cent to 20 per cent.

"These import duties are therefore in clear breach by India of WTO rules. The levies affect EU exports worth 600 million euros per year," the EU has said.

According to WTO rules, seeking consultation is the first step of dispute settlement process. If the bilateral consultations requested by the EU with India do not result in a satisfactory solution, the EU can request the WTO to set up a dispute panel to pass a ruling on the matter.

As per the WTO rules, these countries would have to seek approval from India and the EU to join the consultation process.

Japan in communication to the WTO said it exports to India some of the products particularly cellular mobile phones and their parts.

"A number of Japanese companies which export the products at issue have continued to express their serious concerns on India's tariff increase on those products," it said.

For these reasons, Japan has a substantial trade interest in the consultations and wishes to join in the consultation, it added.

"Japan looks forward to receiving confirmation of acceptance of this request as well as being informed of the date and venue of the consultations," the communication said.

A WTO member country can file a dispute if it perceive that another country's trade policies or actions are violating global trade norms.

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