ICT goods levy: India to not take EU to WTO appellate tribunal; to negotiate a solution under TTC

In 2019, Taiwan, Japan and the EU filed a dispute challenging the import duty levied by India on a range of ICT goods including mobile phones and their components, among others.

India has decided not to take the European Union (EU) to the appellate tribunal of the World Trade Organization (WTO) in the dispute over the import duty levied by India on a range of information and communication technology (ICT) goods, including mobile phones and its components, sources told Moneycontrol.

The country aims to continue negotiations under the India-EU Trade and Technology Council (TTC) and has reassured the EU that the duties are not against it.

The TTC is a key forum to deepen the strategic partnership on trade and technology between the two partners.

The dispute

In 2019, Taiwan, Japan and the EU filed a dispute challenging the import duty levied by India on a range of ICT goods including mobile phones and their components, among others. India levies an import duty between 7.5 percent and 20 percent on such goods.

The EU had argued that these tariffs directly breached India’s obligations under WTO rules to impose zero-duty rates on these goods. The EU filed a case on the alleged violations, followed by similar cases against India’s tariffs filed by Japan and Taiwan the same year.

“We have already deferred the Taiwan case till September and have filed an appeal against Japan which has sent the case into void,” the official said.

There is no Appellate Body Division available at present to deal with the appeals. The tribunal has been inoperative for two years due to the US hindering the appointment of judges. Till the time the tribunal gets all members, all appeals are considered an 'appeal into the void’.

“However, the EU is keen on India not filing an appeal against it and has been continuously talking to us about it,” a commerce ministry official privy to negotiations told Moneycontrol.

The China angle

India, as per the official, has reassured the EU that the duties are not against them but against China.

“A dialogue is currently ongoing on this. We hope to find an amicable solution which works for both countries,” the official added.

The WTO's dispute panel on April 17 this year had said that India's import duties on some ICT goods breached global trade regulations.