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Panel Established under the WTO Agreement Regarding India’s Measures Concerning Tariff Increases on ICT Products

July 30, 2020

On July 29, 2020, in response to a request made by Japan to the World Trade Organization (WTO), the WTO Dispute Settlement Body (DSB) established a panel (first instance) under the WTO Agreement regarding India’s measures concerning tariff increases on information and communications technology (ICT) products.

1. Outline

From 2014 to 2019, India raised tariffs imposed on ICT products six times, for which the country has committed to zero tariffs under the WTO Agreement. In addition, India has further raised the tariffs on some of the products pursuant to the Finance Act of 2020.

Japan considers these measures imposed by India concerning tariff increases on ICT products to be inconsistent with the General Agreement on Tariffs and Trade (GATT), whose provisions stipulate that member countries shall not impose tariffs on goods imported from other countries in excess of the rates in their respective schedules of concession.

On May 10, 2019, Japan requested bilateral consultations with India under the WTO Agreement. However, as these consultations failed to settle the dispute, Japan, on March 19, 2020, requested the establishment of a panel (first instance) to examine this issue under the WTO Agreement. In response to the Japan’s request, on July 29, 2020, the WTO DSB established the panel.

2. Future schedule

Japan will pursue an appropriate solution to this issue in accordance with the rules under the WTO Agreement.

Reference 1: Scope of items and its tariff rates subject to Japan’s request for the establishment of a panel

Scope of item (India’s HS code) Tariff rate
[i] Feature phones (HS85171219) Raised from 0% to 20%
[ii] Smartphones (HS85171211) Raised from 0% to 20%
[iii] Base stations for cellular mobile phones (HS85176100) Raised from 0% to 20%
[iv] Digital microwave communication equipment (HS85176290) Raised from 0% to 20%
[v] Printed-circuit board assemblies (HS85177010) Raised from 0% to 10%
[vi] LCD modules for smartphones, etc. (HS85177090) Raised from 0% to 15%

Note: India has committed to 0% tariffs for all items above as the WTO bound rate.

Reference 2: Outline of a panel under the WTO Agreement

If consultations between governments fail to settle a dispute, based on a request from the complaining WTO Member, a WTO panel (first instance), which is a quasi-judicial third-party organization, examines the matter in question and gives rulings regarding consistency with the WTO Agreement. If any inconsistencies are confirmed, the panel recommends correction of the measures. Any party which is not satisfied with the panel rulings may appeal to the WTO Appellate Body (second instance).

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