India unlikely to move WTO as US scraps special tariffs

NEW DELHI: India may not drag the US to the World Trade Organization (WTO) for ending preferential benefits to its exports, but trade experts say India must raise the issue as the entire review was discriminatory.

Though the benefits under the Generalised System of Preferences (GSP) are supposed to be non-discriminatory and nonreciprocal, the government is unlikely to challenge the US’ move as Washington has withdrawn them on the basis of India not providing “equitable and reasonable access to its markets in numerous sectors”.

“The US has not said that it is ending the benefits on the basis of non-reciprocity. It has talked about equitable market access,” said one official aware of the details.


On Tuesday, Washington said India had implemented a “wide array of trade barriers that create serious negative effects on United States commerce. Despite intensive engagement, India has failed to take the necessary steps to meet the GSP criterion”.

India had challenged the European Union’s GSP regime for seriously drug-affected countries in 2002 and the WTO Appellate Body later found that the EU’s GSP drug regime then was not based on objective and transparent criteria for the selection of the beneficiary countries. “India has argued that the EU had discriminated among developing countries, which is not the case now,” the official added.

“We are yet to take a call whether we will challenge it but discussions are on,” said another official.

However, experts and former trade envoys said the US’ move should be disputed on systemic grounds. “By not challenging this violation, we would be giving up our right to fight for special and differential treatment at WTO. GSP is supposed to be nondiscriminatory,” said Biswajit Dhar, professor at the Centre for Economic Studies and Planning in the School of Social Sciences at Jawaharlal Nehru University.