A team of US officials will be in India later this month to discuss the import duties levied or raised by the Centre last year on smartphones, base stations, smart watches, printer ink cartridges and other ICT products and lobby for their removal.
“The US officials are scheduled to meet Indian officials from the Ministry of Electronics and IT (MeitY). The US has already argued at the World Trade Organization that the duties imposed by India on mobile phones and other ICT products go against its multilateral commitments,” a government official told BusinessLine. The meeting is scheduled on January 24.
India levied customs duty on mobile phones and some other ICT items at 10 per cent for the first time in July 2017 and later increased it to 15 per cent that year. Despite protests from a number of WTO members, including the US, the EU and Japan, customs duties on mobiles were further increased to 20 per cent in last year’s Budget.
Hike in duty
In October, India increased basic customs duty on several telecom equipment and imposed duties on printed circuit boards used to make the equipment and several other telecom products.
“The import duties on telecom products were imposed to keep a check on current account deficit by curbing inflow of non-essential items. It is also in line with the government’s ‘Make in India’ policy,” the official said.
The US, however, argued at the WTO that most of the items, including mobile phones, were included in the IT Agreement (ITA) of the WTO and tariffs were supposed to be nil on these. Both India and the US are part of the ITA signed by countries in 1996.
“MeitY is not in favour of removal of the import tariffs as it feels that domestic manufacturers need protection. India has also argued at the WTO that the ICT items do not fall under the ITA because many of them, including smartphones, had evolved over the last two decades and had not been designed in 1996,” the official said.
The US, however, is not ready to buy the argument. “The US team of officials will try to convince the MeitY to remove the import tariffs on mobiles and the other ICT products and may also indicate if it was planning to file a dispute at the WTO against the move,” the official said.
Source: The Hindu