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iasparliament
February 27, 2019
3 months
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What is the issue?

  • India's attempt to get a ruling on its case challenging an earlier WTO verdict is getting delayed, due to backlog of appeals in the Appellate Body.
  • The US decision to block selection of judges at the WTO's Appellate Body is delaying the clearing of appeals. Click here to know more on this.

What is India's case about?

  • India’s case is related to imposition of provisional safeguard duty of 20% on import of certain categories of steel by India.
  • It is a levy that a member can apply over and above the existing import tariffs, to protect domestic industry against import surges.
  • E.g. since Japan has a free trade agreement with India, iron and steel imports take place at reduced import duties; but as it affects India's domestic industry, India can impose safeguard duty
  • India first imposed the duty in September 2015, which it subsequently reduced and extended till March 2018.
  • In November 2018, the WTO upheld Japan’s complaint against India’s safeguard.
  • It was said that the duty was not based on reasons consistent with multilateral rules.
  • Following this, India challenged the WTO verdict by filing a case with the Appellate Body, the highest decision making body of the WTO.
  • It is important for India that the Appellate Body upholds its challenge.
  • It's because the decision could play an important role in determining if similar duties could be imposed in the future.
  • But the Appellate Body may not be able to come up with its verdict anytime soon.

Why is the delay?

  • The US blocked the appointment of appeals judges at the WTO last year.
  • This has now resulted in shrinking of the number of judges from 7 to just 3.
  • Washington has said that it will allow judges to be appointed only after reforms are brought about in the WTO decision-making process.
  • The Appellate Body admitted its failure to submit its report on India's case within the 90 days period as is the norm.
  • It clarified that because of the complexity of the issue and the pending cases, it will not be able to proceed with the appeal for some time.

 

Source: BusinessLine

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