Retaliatory Import Tariffs On US Products
Why is it in News?
India extended the deadline to impose retaliatory import tariffs on 29 US products till June 16 from the earlier date of May 16 with a hope to resolve trade issues with the US and also because the US has not withdrawn the Generalised System of Preferences which was to happen in the beginning of May.
India had announced retaliatory tariffs worth $230 million on about 29 American goods in June 2018 as a comeback to imposition of penal tariffs on Indian steel and aluminium by the US. But India has since been postponing implementation of these duties hoping to resolve trade concerns.
Generalized System of Preferences (GSP):
- The US had recently announced that it would be withdrawing the GSP benefits granted to India which offer duty-free access to the American market for more than 3,000 items from India.
- The US wishes for India to tackle the ‘price cap’ matter for medical devices, extends greater market access for dairy and agricultural products and also lower high import tariffs for mobile phones.
WTO’s Assessment Of Trade Policies
Why is it in News?
India hosted a two-day WTO ministerial meet of 16 developing and six least developed countries at New Delhi from 13 May-14 May. In the meeting India highlighted the issue of WTO’s assessment of a country’s services trade.
- India believes that the WTO’s evaluation procedure of a country’s ‘services trade’ policies is skewed towards developed countries and needs reform.
- A study commissioned by the Commerce Ministry has found that the current assessment system, developed by the Organisation for Economic Co-operation and Development (OECD), has notable quantitative and qualitative shortcomings. It lists India very high in terms of restrictiveness.
- Initiated in 2014, the Services Trade Restrictiveness Index (STRI) shows the Indian services sector as one of the most restrictive, specifically in policy areas like foreign entry but this finding seems surprising as FDI has been one area that has seen maximum liberalisation in India since 1991.
- India has developed a new method to measure restrictiveness in the services trade that would not have a bias either for developed or developing countries.
- India is trying to rally the support of other developing countries in the WTO i.e. China, Brazil, Indonesia, Turkey, and South Africa etc to reform this practise.