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WTO sets up dispute panel on India-US case on export subsidies

PTI     October 28, 2018

The World Trade Organisation's dispute settlement body has set up a panel to examine the US complaint against certain export-subsidy measures by India as both the sides failed to resolve the issue at consultation level, an official said. In March, the US dragged India to the global trade body's dispute settlement mechanism over export subsidies, saying that these incentives were harming the American companies.

"The process of composition of dispute panel is over. The working procedure and the time table for the panel proceedings has been circulated," the official added.

The US has requested for the establishment of a dispute panel to examine the allegations on India's export incentive measures. Seeking consultation under the aegis of the WTO is the first step of dispute settlement process. If the two nations are not able to reach a mutually agreed solution through consultation, the complainant can request for a WTO dispute settlement panel to review the matter.

The US has challenged India's export subsidy programmes such as Merchandise Exports from India Scheme in the WTO, asserting that these initiatives harm its companies by creating an uneven playing field. They have stated that all WTO members, including India, are required to provide subsidies consistent with provisions of the WTO's Agreement on Subsidies and Countervailing Measures, including refraining from providing subsidies contingent upon export performance.

During the consultation process, the US had alleged that India was continuing to grant these export-contingent subsidies and even expanded the scope and scale of the subsidies. India had stated that it was disappointed that the US chose to move forward with a request for a panel, as it believed bilateral consultations held on April 11 were constructive.

During the consultations, India provided a detailed understanding of the schemes implemented under its Foreign Trade Policy by answering all the questions raised by the US. India has also said that the schemes identified by the US do not violate India's WTO obligations and are in conformity with all the elements of the agreement. India's exports to the US stood at USD 47.9 billion in 2017-18, while imports aggregated at USD 26.7 billion during the same fiscal.

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