| Date: |
10-12-2014 |
| Subject: |
World Trade Organisation rules in India's favour in steel dispute with US |
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NEW DELHI: Indian steel exporters received a major relief with the World Trade Organization (WTO) ruling against the US for imposing heavy countervailing duty (CVD) on steel imports from this country.
The government will now demand withdrawal of CVDs on at least seven other items by the US, imposed using the same formula in the steel case that was found to be "inconsistent" with various provisions of WTO's Agreement on Subsidies and Countervailing Measures. The US has to amend its domestic law to be WTO compliant once this ruling of the WTO appellate body is endorsed by the dispute settlement body of the multilateral organisation.
The US had imposed CVD up to 577 per cent on imports of hot rolled carbon steel flat products from Indian manufacturers such as Tata Steel which are supplied ore by staterun mining firm NMDC. The tax was slapped on assumption that NMDC supplied subsidised ore to these companies, making their products artificially cheaper. AWTO panel had in July upheld the duties after which India decided to appeal, contesting the point that considered NMDC as a "public body".
A CVD cannot be imposed in case a supplier is a private player. In this case, while NMDC is state-run, it does not discharge government functions or possesses government authority, to be called a public body under WTO rules.
"The AB (appellate body) has emphatically endorsed India's position that a public sector undertaking shall be treated as a 'public body' only when they possess governmental authority and discharge governmental functions. This ruling would provide significant relief to exporters who buy raw materials from PSUs such as SAIL or NMDC," the government said.
The "will definitely help the domestic manufacturers who had been suffering on account of inconsistent practices by the US Department of Commerce", India's Department of Commerce said in a news release.
The appellate body's report will likely be put before the dispute settlement body meeting on December 19 in Geneva for adoption, after which the US will be given a time of 30 days for show "intent of implementation" of the ruling. Thereafter, the US will have to implement the decision within 15 months. Out of the 10 products on which the US has imposed CVD, seven suffer from the same inconsistency, which India will take up with the US. These products include steel nails, Steel threaded rods, line paper products, PET, pre-stretched concrete and steel wire strands. "During the implementation stage, we will take the matter up with the US to withdraw CVD on other items as well," said a government official
Source : economictimes.indiatimes.com
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