Kamal Nath hopes EU won’t go to Geneva

NEW DELHI: Commerce and industry minister Kamal Nath has hoped the EU will not have to approach the dispute settlement body of the World Trade Organization to resolve the differences over import duties on wines and spirits imposed by India. He said the two sides were likely to find a solution bilaterally very soon. While agreeing that duties could have been reduced in the Budget, the minister said tariff reduction could happen outside the Budget.

Addressing a press conference on Wednesday, Mr Nath said, “I hope a solution could be found very soon as the matter is being discussed at the highest level.”

Visiting EU agriculture commissioner Mariann Fischer Boel had, on Tuesday, threatened to ask for a WTO panel to settle the dispute. The EU had, late last year, filed a complaint with the WTO against the additional and extra additional duties levied on imported wines and spirits over and above the basic Customs duties. Both India and the EU had decided to settle the issue bilaterally. However, since India did not announce reduction of duties in the Budget, the EU is disappointed.

The US, which, so far, was a third party to the complaint filed by EU at the WTO, has filed an independent complaint against India’s tariff structure on wines and spirits at the WTO.

While India applies Customs duty of 100% on wines and 150% on spirits, an additional duty ranging from 20-75% is applied on wines and 25-150% on spirits.

The contention of the EU and US is that the additional and extra additional Customs duty on wines and spirits breached the national treatment clause of the WTO agreement.