India to retaliate against European Union steel tariffs
India has informed the World Trade Organisation (WTO) that it has decided to impose retaliatory measures against European Union (EU) steel tariffs, which have been in place since 2018 and have been extended until June 2026.
The move comes after bilateral deals with the trading bloc failed earlier this year.
While India did not share details of the retaliatory measures, the country did say it would “increase tariffs on certain products originating from the EU.”
Over a period of five years, India’s exports have been affected by about $4.4 billion and the EU has collected $1.1 billion in import duties due to the imposition of these tariffs.
India now wants to be allowed to impose an equivalent tariff on goods originating in the EU.
“India hereby informs that the safeguard measures from 2018 to 2023 have resulted in a cumulative trade loss to India of $4.412 billion, on which the collection of duties would amount to $1.103 billion. Accordingly, India’s proposed suspension of concessions would result in an equivalent amount of duties being collected on products originating in the EU,” India informed the WTO on Thursday.
“India reserves the right to immediately implement the proposed suspension and adjust the products and tariffs,” New Delhi said, adding that it will inform the WTO about the next appropriate steps.
In 2018, provisional safeguard measures on imports of certain steel products were imposed for the first time on 26 types of steel.
The protective measure consisted of a tariff quota. Steel produced above the quota was subject to an additional tariff of 25 percent.
The idea was to avoid “economic damage” to EU steel producers, given the large global steel overcapacity and China’s growing exports to the trading bloc via Asian countries.
The measure was originally scheduled to last until June 2021, but was later extended until June 30, 2024.
Three months ago, the EU extended protective duties on steel imports until June 2026.
Under WTO rules, such protective measures can last up to eight years, in this case until June 2026.
India opposes the extension of the steel tariffs. They have held bilateral consultations with the EU to argue that the measures have already been ruled inconsistent with WTO standards by a dispute settlement panel.
First publication: Sep 20, 2024 | 9:19 PM IST