US fails to address India’s concerns on hike in steel tariffs

Geneva: The United States on Friday failed to address specific issues raised by India, and five other countries, in separate trade disputes at the World Trade Organization against President Donald Trump’s unilateral measures to impose additional duty on imports of steel and aluminum, said people familiar with the development.

India, along with Canada and Mexico held, Article 4 dispute settlement consultations with the US against the additional duties of 25% on steel and 10% on aluminium imports imposed by the US administration. Three other countries, China, the European Union, and Norway, held their consultations on 19 July.

During the two separate meetings, the US repeatedly said it was not required to provide any reason for Section 232 measures on steel and aluminium since they remain “sovereign determinations” that fall under Article 21 of the GATT 1994, said participants, who did not wish to be quoted.

The six countries, however, disagreed with the US and raised several questions. The complainants maintained that the additional duties on steel and aluminium constituted a “disguised safeguard” measure as the US Department of Defence had said that there was no threat to the country’s national security from steel and aluminium imports.

The complainants also asked the US whether Washington had complied with the requisite “transparency” provisions before determining the duties, and sought to know whether it had held consultations with domestic steel and aluminium companies before imposing the duties.

In response, the US said it cannot share the reasons for the decisions under the Section 232 provisions. The US team also said it was not in a position to provide any reason.

The complainants asked the US to explain how countries such as Australia, Brazil, Korea and Argentina were exempted from the additional duties, and how those imports did not pose any national security threat. The US was also asked whether exemptions amounted to undermining the most-favoured-nation treatment principle.

Besides, they sought an answer to President Trump’s decision to increase the duties on steel and aluminium to 25% and 10%, respectively, despite the US Department of Commerce suggesting duties of 21% and 7%. The US team said it was unaware of the underlying considerations for the final decision.

Given the US’ failure to provide credible answers, the six countries may request the WTO to establish a disputes settlement panel to rule against the US measures. Russia and Switzerland are yet to complete their consultations with the US.

However, on Thursday, the US told Switzerland that “the tariffs imposed pursuant to Section 232 are issues of national security not susceptible to review or capable of resolution by WTO dispute settlement, and the consultation provision in the Agreement on Safeguards is not applicable”.