At a meeting of the Dispute Settlement Body (DSB), the WTO granted it additional time to consider the adoption of the panel ruling, which had, on April 17, said that the import duties imposed by India on certain information and technology products violate global trading norms under the Information Technology Agreement, based on disputes filed by the EU, Japan and Taiwan against these duties.
“The EU said the two sides will use this additional time to engage in constructive discussions to hopefully reach a commonly acceptable solution,” said a Geneva-based official.
If the talks fail, the EU could adopt the WTO panel filings and India could take the case to the Appellate Body of the WTO, which hasn’t been functional for nearly two years due to the US blocking the appointment of judges.
India has appealed against the ruling in its dispute with Japan and has extended the time to decide on an appeal against Taiwan on a similar ruling in the ICT disputes.
The dispute was filed in 2019 when the three members had challenged the import duty of 7.5%-later increased to 15%-levied by India in 2017. India further raised the duty to 20%. India had imposed these duties to boost local manufacturing.
The additional time for dispute resolution is important because India and the EU are negotiating a trade deal and any dispute can become an impediment. The ruling had the industry rattled and it was apprehensive about cheaper imports finding their way and denting domestic manufacturing.
New Delhi has also rejected the EU’s offer to resolve the issue through a Multi-Party Interim Appeal Arbitration Arrangement, which is an alternative system to resolve WTO disputes.