India offers to give inputs in EU case on liquor duty

New Delhi: The World Trade Organisation (WTO) has set up a dispute settlement panel to study the European Union’s petition against India’s high import tariffs on wines and spirits. India had earlier used its right to reject EU’s request when the plea was taken up for the first time two weeks ago. Since no such facility is available when a proposal is discussed for the second time, a DSP is the way out.

As reported by ET last week, the WTO will now appoint members of the panel and give it a time-frame to carry out the investigation. Both sides would be heard before a verdict is announced. Official sources said India would provide its inputs to the panel shortly.

Meanwhile, the government is working on a legislation that will enable state governments to impose excise on imported liquor. This would be WTO-compliant as long as states charge the same excise from domestic manufacturers, meeting the ‘condition of national treatment’.
The EU has been asking India to bring down tariffs on wines which range from 177.33-264% for imported wines and from 252.22-550% for imported spirits.

India has made a commitment of freezing its duties on alcohol at 150% which means that at no point of time can the country have a higher duty than 150% on import of liquor.