Latest news with #AgreementonSafeguards
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Business Standard
a day ago
- Business
- Business Standard
India challenges 25% US auto tariffs at WTO, seeks safeguard consultations
India has formally challenged the United States' imposition of steep tariffs on auto imports by lodging a request for consultations with the World Trade Organisation (WTO) amid ongoing bilateral talks with Washington. In its June 2 filing, India stated that the 25 per cent duties imposed by the US on passenger vehicles, light trucks, and specific auto parts constitute a "safeguard measure", intended to protect US domestic producers from a perceived import surge. The tariffs, effective from May 3, 2025, were introduced without prior notification to the WTO's Committee on Safeguards, violating Article 12.1(c) of the WTO's Safeguards Agreement, India said in its submission. India presses for talks, warns of retaliation India's request seeks consultations under Article 12.3 of the Safeguards Agreement, aiming to 'exchange views' with the US and assess the legality of the measure. It highlighted its 'significant export interest' in the affected auto products and called on Washington to respond swiftly with a proposed date and venue for the talks. India also formally reserved its right to take retaliatory action if the consultations fail to reach a resolution within the 30-day window permitted under WTO rules. 'India reserves all its rights under the Agreement Establishing the World Trade Organisation and its Annexes, including the Agreement on Safeguards,' the notice stated. The filing at the WTO marks the first time New Delhi has taken a more assertive stance in its trade talks with the US. India was among the first countries to engage with the Trump administration following the announcement of 'Liberation Day' tariffs and, until now, had steered clear of openly criticising US trade policies, favouring quiet diplomacy instead. However, India has previously signalled its willingness to respond in kind, having threatened reciprocal action over US tariffs on metal imports. US delegation to arrive in India for trade talks The WTO filing comes at a crucial time as negotiators from both sides are working to wrap up a potential interim trade deal before July, when a 90-day pause on new tariffs ends. The timing also overlaps with a visit by a US trade delegation to India on June 5-6, aimed at advancing talks on a wider set of tariff issues, including the recent doubling of US duties on steel and aluminium. India's submission argued that since the US measures qualify as safeguards, they must adhere to specific procedural steps outlined in WTO rules. If talks collapse, India is permitted under WTO rules to suspend equivalent concessions by imposing its own duties in response. 'India reserves all its rights under the Agreement Establishing the World Trade Organisation and its Annexes, including the Agreement on Safeguards,' the notice concluded. WTO rules permit a country to suspend equivalent concessions, such as imposing its own duties, if consultations do not lead to a settlement.
Time of India
2 days ago
- Business
- Time of India
India, US discuss metals tariff objection
India is bilaterally discussing with the US its claim at the World Trade Organization (WTO) that there is no basis for New Delhi's proposal to retaliate against the American tariffs on steel and aluminium, said an official. The issue will also be taken up in the India-US bilateral trade agreement (BTA) talks. "The US has said our proposal to retaliate is baseless and we are bilaterally discussing with them at WTO. It's being discussed in the BTA talks also," said the official. In early May, India proposed to levy retaliatory duties on 29 American products including apples, almonds, pears, anti-freezing preparations, boric acid and certain products made of iron and steel under the WTO to counter US tariffs on steel and aluminium. New Delhi told the WTO that these safeguard measures would affect $7.6 billion worth of imports into the US. However, the US refused to discuss the Section 232 tariffs under the Agreement on Safeguards as it does not view the tariffs as a safeguard measure. Section 232 authorises the US president to adjust imports of goods which can threaten to impair US national security. "Given this rejection, India now faces several options including launching a formal WTO dispute under broader GATT rules, challenging the Section 232 tariffs as disguised protectionist actions, arguing that the US is abusing the national security exception," said a Delhi-based trade expert. "This issue will be crucial in the India-US BTA trade talks," said the official. A team of US officials is visiting India this week for discussions on the proposed interim trade agreement between the two countries. The two aim to negotiate the first tranche or phase of a mutually beneficial, multi-sector BTA by fall this year and more than double the bilateral trade to $500 billion by 2030 from the current level of $191 billion. The two sides are likely to agree on an interim trade agreement by the end of June, with New Delhi pushing for full exemption from the 26% reciprocal tariff on domestic goods. On March 8, 2018, the US promulgated safeguard measures on certain steel and aluminium products by imposing 25% and 10% ad valorem tariffs respectively, effective March 23, 2018. On February 10, 2025, it revised the measures on imports of steel and aluminium articles, effective March 12. India said the US failed to notify the WTO Committee on Safeguards on taking a decision to apply safeguard measures, and as an affected member with significant export interest, it has requested consultations with Washington. (The correspondent is in Paris at the invitation of the commerce and industry ministry)
The Print
2 days ago
- Business
- The Print
India seeks WTO consultations with US over safeguard measures on auto components
On March 26, 2025, the US adopted a measure in the form of a tariff increase of 25 per cent ad valorem on imports of passenger vehicles and light trucks, and on certain automobile parts originating in or from India, a communication sent by India to WTO said. This move comes shortly after India reserved the right to impose retaliatory duties on select US products in response to American tariffs on steel and aluminium. New Delhi, Jun 3 (PTI) India on Tuesday sought consultations with the US under the World Trade Organisation's (WTO) safeguard agreement over American tariffs on auto components. The measure on automobile parts applies from May 3, 2025 and for an unlimited duration. 'India considers that the measure, in its design and effect, constitutes a safeguard measure within the meaning of…. GATT (General Agreement on Trade and Tariff) 1994 and the Agreement on Safeguards, as it is intended to protect the US domestic industry from increased imports,' it said. It added that the United States failed to notify the WTO Committee on safeguards under a provision of the Agreement on Safeguards (AoS) on taking a decision to apply the safeguard measure. 'Accordingly, as an affected Member with significant export interest to the United States in the products concerned, India requests consultations with the United States,' it said. In the consultations, India would like to exchange views on the measure. 'India looks forward to receiving a prompt reply to this request from the United States and to setting a mutually convenient date and venue for the… consultations,' it said. India reserves all its rights under the agreement establishing the WTO. The US imported USD 89 billion worth of auto parts globally last year, with Mexico accounting for USD 36 billion, China for USD 10.1 billion, and India for just USD 2.2 billion. PTI RR DR This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
Time of India
2 days ago
- Automotive
- Time of India
India seeks WTO consultations with US over tariffs on auto components
India has formally requested consultations with the United States under the World Trade Organisation's ( WTO ) Agreement on Safeguards, challenging a recent US decision to impose 25 per cent ad valorem tariffs on certain automobile components and vehicles imported from India, PTI reports. According to a communication sent by India to the WTO on Tuesday, the tariffs—effective May 3, 2025, and applicable for an unlimited duration—are part of a broader US move targeting imports of passenger vehicles, light trucks, and automobile parts from select trading partners. India Flags Safeguard Violations India contends that the US measure qualifies as a safeguard measure under the General Agreement on Tariffs and Trade (GATT) 1994 and the Agreement on Safeguards, as it aims to protect the US domestic auto industry from increased imports. The communication highlights that the US failed to notify the WTO Committee on Safeguards, violating the procedural obligations under WTO rules. "India considers that the measure, in its design and effect, constitutes a safeguard measure... intended to protect the US domestic industry from increased imports," the communication stated. Consultations Sought for Dispute Resolution India has requested formal consultations with the US to exchange views and resolve the issue. It also emphasised its significant export interest in the affected products and expressed the need for prompt engagement to schedule discussions. 'India looks forward to receiving a prompt reply... and to setting a mutually convenient date and venue for the consultations,' the note said. India also reiterated that it reserves all its rights under the WTO framework. Context: Rising Trade Tensions The move comes shortly after India reserved the right to impose retaliatory duties on selected US products in response to American tariffs on steel and aluminium. The WTO filing signals India's increasing readiness to push back against protectionist trade policies through legal mechanisms. In 2024, the US imported $89 billion worth of auto parts, with: -Mexico accounting for $36 billion -China for $10.1 billion -India contributing $2.2 billion While India's share is comparatively small, the new tariffs could have a disproportionate impact on key Indian exporters in the automotive supply chain. India's challenge at the WTO marks a critical moment in its trade relationship with the US, as it seeks to protect its export interests and uphold multilateral trade norms. The outcome of these consultations could have broader implications for global automotive trade and WTO safeguard disciplines. (Source- PTI)
Indian Express
2 days ago
- Business
- Indian Express
Tariff Tracker, June 3: What next for India? US dismisses WTO challenge, EU trade deal ahead
Dear reader, The Organisation for Economic Cooperation and Development (OECD) announced on Tuesday (June 3) that global economic growth had slowed more than expected a few months earlier, following US President Trump's tariff announcements. In its latest Economic Outlook, the OECD estimates that the global economy will slow down from 3.3% in 2024 to 2.9% in both 2025 and 2026. It had previously forecast growth of 3.1% for 2025 and 3% for 2026. The organisation also cautioned against rising protectionist tendencies globally, which it said would add to inflationary pressures, as well as the overall uncertainty of future trade barriers, which could further dampen global economic growth. The OECD projects that India will experience 'strong and broadly stable' economic growth, with real GDP estimated at 6.3% in FY2026 and 6.4% in FY2027. According to the organisation, the prospect of benign inflation, tax cuts and a stronger labour market will help to boost private consumption, while falling interest rates and increased public capital spending will help boost investment. However, US tariffs would make Indian exports expensive. The Indian Express reported on Tuesday that the US has dismissed India's notice at the World Trade Organization (WTO) proposing retaliatory action against the US for the Section 232 tariffs on imported steel and aluminium. On May 9, India submitted a document to the WTO, identifying the American metals tariffs, effective from March 12, as 'safeguard measures'. The WTO's Agreement on Safeguards (AOS) identifies safeguards as protectionist measures that a member country may invoke if it determines that certain product imports are significantly large and may 'cause or threaten to cause serious injury' to the corresponding domestic competitor. According to India's note, the tariffs impact $7.6 billion worth of Indian exports into the US, on which $1.91 billion would be collected as duties. India's proposed retaliatory measure would result in an equivalent amount of duty collected from products originating in the United States,' it said. The specific US products were not specified. In its response to the WTO on May 23, the US said that India's contention that the tariffs are 'safeguard measures' is incorrect, that the Section 232 tariffs were imposed on national security grounds, and even claimed that India had not followed due procedure in seeking negotiations on the subject. This development comes amidst US Commerce Secretary Howard Lutnick's remarks on Monday, expressing optimism about a US-India trade deal. He said that trade negotiators have 'found a place that really works for both countries.' 'You should expect a deal between the United States and India in the not-too-distant future,' he said at the US-India Strategic Partnership Forum's Leadership Summit in Washington. We have previously explained how India will be affected by Trump's tariffs: the US is India's largest trading partner, while India is the US's 10th-largest trading partner. The US maintained a trade deficit of $45.7 billion with India in 2024, up 5.4% from 2023, according to the Office of US Trade Representative (USTR). India currently faces 26% 'reciprocal tariffs' under the International Emergency Economic Powers Act (1977). The US subsequently paused all reciprocal tariffs on April 9, while a legal battle over the validity of these tariffs (as well as the 10% baseline tariff charged on all countries) is currently underway. The White House justified this rate, saying India charges a 70% tariff on passenger vehicle imports, 10-20% on networking switches and routers and 50% on rice in the husk. India also faces the Section 232 duties of 25% on steel, aluminium and automobiles, which will be doubled to 50% from Wednesday (June 4). We previously noted that the US is the largest market for Indian aluminium, with exports valued at $946 million in FY2024. These exports had exceeded $1 billion in the previous two financial years, and were up from just $350 million in 2016-17 when Trump first became President. Similarly, the US was also the largest market for Indian iron and steel articles, with Indian exports valued at $2.8 billion in FY2024. Lutnick also said that India may benefit from being one of the first countries to seek a trade deal with the US. 'Earlier countries get a better deal, that's the way it is', he said. 'So those who come in July 4th to July 9th, there's just going to be a pile.' The 90-day tariff pause expires in July, and India is pushing to effect the trade deal before the end date. While India has attempted to appease the US, slashing duties on American imports like bourbon whiskey and Harley-Davidson motorcycles, it has also expressed its discontent with Trump's assertion that he helped broker a ceasefire between India and Pakistan last month. The Financial Times on Tuesday (June 3) reported that India and the European Union have achieved consensus on about eight out of roughly 20 topics to be covered by a prospective trade deal. This follows Indian commerce minister Piyush Goyal's meeting with EU trade commissioner Maroš Šefčovič in Paris on Monday. Both India and the EU are looking to finalise the trade deal this year, building on a commitment by Prime Minister Narendra Modi and European Commission President Ursula von der Leyen in February this year. The topics reportedly include subjects like rules of origin and intellectual property rights, but will not address 'sensitive' farming products such as dairy, FT reported. The announcement is significant, with both India and the EU seeking relief from Trump's tariffs. According to the European Commission, the EU is India's second-largest trading partner, accounting for goods trade worth €120 billion (about $137 billion) in 2024, or 11.5% of India's total trade. India, on the other hand, is the EU's 9th largest trading partner, accounting for 2.4% of the EU's total trade in goods in 2024. The goods trade between the EU and India has increased by 90% over the past decade, with the main Indian exports being machinery and appliances, transport equipment, and chemicals. The trade in services between the two in 2023 was €59.7 billion (about $68 billion), with the EU accruing a deficit of €7.9 billion ($9 billion).
