India refutes USTR report on trade barriers

Refuting a US report on trade barriers, India on Friday said its regime is transparent and consistent with the World Trade Organisation's rules and regulations.

New Delhi: Refuting a US report on trade barriers, India on Friday said its regime is transparent and consistent with the World Trade Organisation's rules and regulations.

"India's policies relating to tariffs, import policies, government procurement, export subsidies, intellectual property protection are consistent with its international and bilateral obligations," a Commerce Ministry official said.

In its latest report - '2013 National Trade Estimate: Foreign Trade Barriers' - the US Trade Representative (USTR) has listed a whole range of difficulties American companies face in India, preventing them officials from realising the full potential of India-US economic relationship.

"While the US has actively sought bilateral and multilateral opportunities to open India's market, US exporters continue to encounter tariff and non-tariff barriers that impede imports of US products, despite the government of India's ongoing economic reform efforts," the report has said.

The Commerce Ministry official however said that India has been implementing its tariff policy within multilateral commitments and is committed to further liberalisation based on the global negotiations.

"In fact, India has been unilaterally reducing its tariff over the years. India's import licensing policies are consistent with it's WTO obligations," he said.

On government procurement issue, the official said that India is not a signatory to the WTO's Government Procurement Agreement and hence "many of the obligations that the report seeks to attribute to India are misplaced".

The Indian government, he added, is exercising its procurement policy in consonance with its perception of national interests and policy prerogatives. They neither violate any international agreement nor bilateral commitment.

Referring to the allegations with regard to intellectual property rights, the official said India's IPR regime is in consonance with its obligations under the TRIPS agreement.

He further said that the recent decision of the Supreme Court rejecting the patent plea in the Novartis case has reiterated that India's interpretation of Section 3(d) of the Indian Patent Act has balanced its public health interests with that of innovation.

With regard to the issues concerning services industries like insurance, banking, accounting and legal, the official said the country's regulatory regime is based on national interest and is in accordance with the commitments under General Agreement on Trade in Services (GATS).

The official said the granting of compulsory license to NATCO in case of the Nexavar drug is an indication that "India believes that it's actions are in consonance with the flexibility that the TRIPS Agreement offers to act in public interest".

He added that the country has expressed serious concerns over the steep hike in visa fees under the Public Law of the US which has implications for US's obligations under the WTO.

"India believes that further liberalisation of the services sector would be possible on a multilateral basis rather than on plurilateral efforts," the official said.

According to the report, the US trade deficit with India was USD 18.2 billion in 2012, up USD 3.5 billion from 2011.

India is the 18th largest export market for US goods.

Further, with regard to import policies referred to in the report, the official said that India has strived for simplification of its tariff structure over the years which enhances transparency and predictability.

India's import licensing policies are consistent with it's WTO obligations, he said adding India is committed to phase out export subsidies as per its commitments under the Agreement on Subsidies and Countervailing Measures (ASCM).

On the issue other barriers including local content requirements in the National Solar Mission, the official said India believes that this is consistent with the country's obligations under the multilateral rules.

On the other hand, India notes with serious concern the Buy American provisions as well as many programmes in the US relating to the promotion of renewable energy contingent on local content requirements, the official added.

"The report unfairly and incorrectly views regulatory requirements and legitimate policy prescriptions as constituting barriers to trade," the official said.

"This approach is untenable since it would tantamount to interfering in the sovereign policy space of India.

"India reiterates that the report reflects a biased picture on India's policy requirements in order to protect US export interests and refutes it unequivocally," he said.

The official added that the country is committed to its international obligations as well as engaging in progressive negotiations at the multilateral level for enhancing a predictable, transparent and rule based multilateral trading system.


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