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Harald Aspelund, chair of the WTO trade policy body review
Harald Aspelund, chair of the WTO trade policy body review

WTO raises concerns over implications of govt’s programmes

Members noted that India’s policy relied heavily on tariff, export taxes, min import prices, import and export curbs

World Trade Organization (WTO) members have raised concerns over the Centre’s programmes, such as Atmanirbhar Bharat, to promote domestic manufacturing and import substitution, cautioning India about trade restrictions such programmes could attract.

“Members took note of the programmes put in place to promote foreign direct investment and local manufacturing, and to further integrate Make in India, Digital India, Start-up India, Skill India and Self-Reliant India into global supply chains. They welcomed these initiatives, while raising concerns about the possible trade restrictions they could introduce, urging India to be mindful of any trade implications," ambassador Harald Aspelund, chair of the WTO’s trade policy review body, said in his concluding remarks during India’s 7th trade policy review.

India’s average tariff increased from 13% in FY15 to 14.3% in FY21 with policymakers frequently using measures to encourage domestic production and curb inflation, the WTO said in its latest Trade Policy Review report for Asia’s third-largest economy conducted between 6 and 8 January.

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WTO members acknowledged India’s “comprehensive stabilization and stimulus package" to deal with the pandemic, but encouraged New Delhi to ensure that these measures were designed and implemented in a transparent manner and that they meet legitimate policy goals without unduly restricting trade.

Members noted that India’s trade policy had remained unchanged since the previous review in 2015, with continued heavy reliance on instruments such as tariff, export taxes, minimum import prices, import and export curbs, and licensing.

“On tariff, concerns were expressed with respect to complexity and uncertainty, an increase in tariff rates, preferences, and concessions. Highlighting that India was an active user of trade remedies, members asked India to take a cautious approach in applying anti-dumping and safeguard measures and emphasized that all relevant investigations should be conducted in conformity with WTO provisions," the chairperson said.

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