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MOVES WTO AGAINST USA OVER CHANGES IN RULE OF ORIGIN FOR TEXTILE GOODS
INDIA MOVES WTO AGAINST USA OVER CHANGES IN RULE OF ORIGIN FOR TEXTILE GOODS By
Taxindiaonline News Service NEW DELHI, FEB 3 : UNDOGGED by unimpressive success rate India has filed its ninth complaint against the USA with the WTO Dispute Settlement Body. Five complaints, including the latest one, are against the US discriminatory textile policy. India has protested against the Washington's amendment in the rules of origin clause for textile and other apparel products. India has alleged that these changes have been made with an eye to protect domestic textile sector and deny a chance for fair competition to Indian goods. A row cropped up when the USA amended its rules of origin provisions for textile and apparel exports in 1996 and declined to treat these products on par with other industrial goods. The amended provisions stated that if a grey fabric was produced in a particular country then it was deemed to originate from that country. But India insists that the country of origin should be taken into account only where a major value-addition is done and the grey fabric is turned into a consumable marketable product. India's complaint is that the US rules of origin have undergone at least two major changes in the past six years and the latest change based on an oral accord with the EU tends to protect only EU's interests. India argues that for products like blankets, table linen, beds and scarves the country in which the grey fabric is made is deemed as the country of origin. Likewise, for apparels, the countries where the component parts are cut into different shapes are not termed as the country of origin. India has stated in its complaint that all these changes have made it a very complex set of rules for other countries which have been exporting these items to the USA. Apart form India, several other countries like Japan and Pakistan have also protested against these changes. WTO RULES AGAINST INDIA'S AUTO POLICY BUT POLICY-MAKERS DESERVE KUDOS By
Taxindiaonline News Service NEW DELHI, 23 DEC : WHEN the EU and the USA had moved the WTO Dispute Settlement Body in July 1999 against India's innovative Auto Policy insisting on signing MoU for mandatory indigenisation of manufacturing of components and necessary exports obligations for trade balancing, Indian policy-makers were more than certain that it violates the basic tenets of WTO-sponsored free trade regime and would lose the case whenever decided. And this is what has happened with the final report going against India. But credit goes to our Commerce Ministry policy-makers who came up with this astute idea to pay back the developed countries in their own coin. Having seen how Indian exports were being subjected to all sorts of technical and non- technical trade barriers and a spate of anti-dumping cases, including back to back, India has no option but to frame such a policy which could protect the investment made in the domestic economy and also balance its fragile foreign trade accounts. Going by the sheer number of foreign-make passenger cars, it is absolutely wrong for either the US trade representative or the EU spokesperson to say that India did everything possible to block the foreign car-makers from making use of its vast market. True, India left no stone unturned to protect the interests of all those domestic as well as overseas auto players who had invested millions to set up manufacturing plants in the country. What is equally true is that the US and the EU car-makers depended more than their Korean counterparts on their governments' bulldozing potential to make India throw open the gate for all sorts of imports. But it did not happen and they had to jack up their investments and speed up the process of indigenisation of components and also undertake exports to neutralise the forex outflow. Since under the WTO obligations India had some more time left to play within the rules and it did well. The Special Secretary, Mr Nripendra Misra, says that "our policy has achieved the purpose''. Most auto makers who had signed the MoU have achieved their exports obligations and attained a good measure of indigenisation. Whatever little is left to be achieved, there are different ways to enforce that. When the developed countries are getting paid in the same coin they should not cry hoarse about it. Our policy-makers in other ministries should also follow a similar strategy and follow the rules of the market either by creating technical or non-technical barriers which are the harsh realities of the prevailing dynamics of global competition. INDIA ACHIEVES NOTHING BUT MARAN SHOWCASES HIS GAINS By
Taxindiaonline News Service NEW DELHI, 17 NOV : IT was a press meet organised by the Commerce Ministry to showcase the achievements of Mr Murasoli Maran who is just back from Doha. He said that ''perhaps for the first time we have something positive to show from trade negotiation''. He was not wrong when he said that as we never argued and protested against anything in the past. India used to be a mute spectator of most negotiations done at the previous meets. But if Mr Maran is making tall claims about some gains it is also equally wrong as he has not made any tangible gains from it. True, he alongwith other developing countries succeeded in stalling decisions on a few major items but there doesn't seem to be any gain from any decision. However, Mr Maran said that India agreed to some of the environmental demands of the EU as a trade off for some gains on the agricultural front. As EU has been insisting on environmental issues for long and was willing to accommodate some of India's demands on exports of agricultural items as a trade-off, he accepted their demands for a stricter adherence to environmental norms by the Indian industry. He said that India's gains are more 'significant' particularly in the areas of TRIPS and public health. Yet another gain he counted was that India kept away from a few contentious issues like competition policy, transparency in government trade facilitation and investment. On anti-dumping duty being imposed by industrialised nations on Indian goods, Mr Maran said that it was an achievement for us as back to back inquiries would not be allowed now. There has to be a gap of 365 days for initiating such a probe. WTO FOURTH MINISTERIAL MEET TO BE HELD IN QATAR By
Taxindiaonline News Service NEW DELHI, 9 FEB: THE WTO General Council has decided to hold the fourth Ministerial Conference in Qatar on November 9-13 this year. The Qatar Government offer to host the next round of talks was accepted by the Council which also authorised its Chairman to initiate consultations with the Member- countries on both organisational and substantive matters related to the conference and report back to the Council. The General Council, on January 30, had accepted the offer of the Government of Qatar. In fact, Qatar was the lone country which had made this offer to the WTO. While talking to newspersons, the DG of the EU said that the agenda for the fresh round of talks would comprise of services, agriculture, investment policy and competition policy. He also ruled out the possibility of discussing core labour standards issue which is to be dealt by the International Labour Organisation. The issue is not linked to trade sanctions and the EU had made its stand clear at the Seattle Conference, he added. Meanwhile, coinciding with their recent attendance at the annual meeting of the World Economic Forum in Davos from January 25-29, three former WTO Directors-General released a joint statement containing observations on the multilateral trading system. The former DGs consider the political, public and economic environment in which the multilateral trading system is currently functioning. They described the WTO as "one of the most precious tools of global economic management at the disposal of governments" and add that "the fundamental concepts that underlie the institution are as valid and crucial today as they were when written into the General Agreement on Tariffs and Trade over 50 years ago". The former Directors-General described current pressures on the multilateral trading system and underline key priorities, as they see them, for the WTO in the period ahead. Chief among these priorities is moving forward with a broad trade negotiation within the WTO. INDIA PROPOSES LIBERAL MOVEMENT FOR PROFESSIONALS AT WTO By
Taxindiaonline News Service NEW DELHI 30 DEC : INDIA has filed a proposal in the WTO on the "Proposed Liberalisation of the Movement of Professionals under the General Agreement on Trade in Services (GATS)" as part of the Mandated Services Negotiations. The objective of this proposal is to assess the nature of liberalisation that has taken place in Mode 4 under the existing GATS framework and the key barriers that prevent the movement of professionals. The paper suggests possible strategies and approaches to achieving meaningful liberalisation in this area which is of primary importance to India and could contribute to effective market access for Indian professionals. The paper has made the following recommendations: ++ Improving the structure of commitments; ++
Enlargement of horizontal commitments to include specific category of ++ Uniform definitions and coverage of broader service personnel categories ++ Specific sectoral/sub-sectoral commitments in sectors of interest. ++
Disaggregated categories of Service providers in sectoral schedules to be As regards Economic Needs Test (ENT) clear and transparent criteria to be laid down for applying such Tests and for establishing norms for administrative and procedural facilities. Fewer occupational categories to be made subject to such Tests. In sectors/sub-sectors where ENT is to be used its application should be based on multilateral principles laid out in a " Reference Paper on use of ENT". ? On administrative procedures relating to Visas/Work Permits Member countries should ensure a more transparent and objective implementation of their regimes. Further temporary service providers should be separated from permanent labour flows. This could be achieved either by introducing special GATS Visa for categories of personnel covered by the commitments undertaken by the Member in Mode 4 under GATS or though a sub-set of administrative rules and procedures for temporary movement which are simpler and faster. Exemption
from contributions to social security for developing country WTO IS NO GUARANTEE FOR FAIR TRADE: TEXTILE COMMISSIONER By
Taxindiaonline News Service NEW DELHI, NOV 20: THE Textile Commissioner, Mr B C Khatua, has said that the emergence of the World Trade Organisation regime is not a guarantee for a fair and free trade. Unless India arms itself to face the growing challenges in the global trade, even the domestic market might get adversely affected. Addressing a seminar on preparing the textile industry for world market, Mr Khatua said not long ago our textile products had taken a place of pride in the world trade. But it seems to be now losing initiatives to make gains from free trade. This is because of poor quality of products and greater smartness of competitors. He observed that the emergence of trade blocs, interpretation of the 'rule of origin', inability to enforce decisions on developed countries and poor representation at the dispute settlement body have put developing countries at a disadvantage. The Secretary of the Textile Committee of the Ministry, Mr R C M Reddy, said that the industry was in a critical phase and asked for immediate upgradation of technology and conformity to global standards in production. He referred to the New Textile Policy as a major initiative to give a boost to textile exports. The industry was also exhorted to make use of the Technology Upgradation Fund for which the government has provided a huge corpus of funds. This fund can be availed by the needy for upgrading the technology in this sector. ANALYTICAL SKILLS REQUIRED TO DO WELL IN GLOBAL TRADE: SENGUPTA By
Taxindiaonline News Service NEW DELHI, NOV 16: COMMERCE Secretary Prabir Sengupta has said that there was an imperative need for developing the required level of analytical expertise in the area of external trade relations as the developing countries had an inadequate expertise in the area of international trade relations. Developing countries have also a poor understanding of the WTO system and often fail to see the fall-out of the commitments made by them which has already resulted in a large gap between initial expectations and actual results in the post-Uruguay Round period, he added. While inaugurating the Regional Meeting on Research and Training Needs in International Trade in Asia-Pacific Countries Mr Sengupta emphasised that the WTO mechanism could not be looked into in isolation from the overall development strategies that the developing and the least developed countries had embarked upon and in this context it was necessary that domestic capability in terms of formulating appropriate trade policies and export promotion strategies gets developed in these countries. What is necessary is an appropriate strategy that promotes both trade and development, he said. Further underlining
the importance of having a well-oiled machinery for analysis Stating
that many lessons could be drawn from the recent economic experiences such as
the crisis in East Asia the Commerce Secretary said that a proper analysis for
such experiences would surely facilitate development of appropriate policy responses
with a view to avoiding recurrence of similar situations. Quoting from the Trade
& Development Report 2000, the Secretary said that while policy makers had
rightly rejected a retreat into protectionism it would be just as wrong to allow
global market forces to dictate future growth and development. The Report he said
also reiterates that thrust in market forces and monitory policy alone would not
carry the day in an increasingly inter-dependent global financial and trading
system He
reiterated India's stand on the need for the operationalisation of the special
and differential treatment provisions of the WTO agreements without which he said Speaking on the occasion Mr Dharmarajan informed the gathering that IIFT had recently entered into a MOU with UNCTAD under which the Institute would serve as the Regional Training Centre for Asia on multilateral investment treaties. The Institute had also entered into a MOU with the Centre for International Development Harvard University for conducting joint studies for export development strategy for India, he said. AUSTRALIA, INDIA FOR CLOSE COOPERATION ON WTO ISSUES By
Taxindiaonline News Service NEW DELHI, OCT 20 : IN a move which might herald a new era of close cooperation for Australia and India, the former has sought latter's help in the on-going talks on agriculture in the WTO. Australia is a member of the Cairns Group which favours liberalisation of the world trade in agriculture particularly removal of export subsidies in the developed countries which have a distorting effect on world agricultural trade. The Australian Minister for Trade,
Mr Mark Vaile, noted in his meeting with the Commerce and Industry Minister that
liberalisation of world trade in agriculture under the WTO Agreement on Agriculture
would provide better market access The Indian Minister reiterated India's worry about the implementation of these issues in the WTO and highlighted the need for confidence-building measures by addressing specific concerns of developing countries before launching a new round of multilateral trade negotiations. While underlining the need for exporting more to Australia so as to achieve a more balanced growth of trade both ways Mr Murasoli Maran took the opportunity of raising several bilateral trade issues with Mr Vaile such as early finalisation of a proposed agreement between quarantine agencies of the two countries for recognition of the certification of seafood, processed foods given by Indian authorities so as to facilitate entry of Indian exports into Australia and fast-track registration for manufacturers of pharmaceuticals. Late yesterday's evening a Memorandum of Understanding (MoU) on Information Technology was signed by Mr Vaile and Mr Pramod Mahajan, Minister for Information Technology in the presence of Mr Maran providing the framework for a rapid expansion of bilateral cooperation in a wide range of IT activities. At the last India-Australia Joint Business Council Meeting held last April both sides had set a goal for bilateral merchandise trade to reach a level of Australian $ 4 billion in 2000-2001. US ASKED TO AMEND ANTI-DUMPING LAWS GENEVA, OCT 10: IN a significant development, the World Trade Organisation (WTO) has asked the US Government to change its Anti-dumping laws that have been in effect since 1916 as they no longer conform to WTO rules. The US Tariff Act was enacted in 1916 to protect the US industry from unfair competition from products imported by foreign companies at prices below their cost of production. The European Union and Japan called on the WTO to give verdict on the issue. The WTO's initial decision in the case came down in favour of the EU and Japan, a ruling now confirmed by the international organision's appeals body. In a statement, the EU has welcomed it by describing it as a clear condemnation of this US law, which has been invoked several times against EU companies and are still used against them. EC DOES IT AGAIN, SLAPS DUTY ON PSF By
Taxindiaonline News Service NEW DELHI, OCT 9: THE European Commission (EC) has imposed provisional Anti-dumping duties, ranging from 25 to 36 per cent on polyester staple fiber (PSF) imports from India. The duties, clamped after a petition filed by the apex body for European manufacturers, are to adversely affect big exporters like Reliance Industries, Indian Organic Chemicals and JCT among others. Sources here in Delhi said taht the EC disclosure document states India's share of exports to the EU jumped from 0.5 per cent in 1996 to 2.9 per cent in 1999. It has also observed that PSF consumption in Europe went up by 29 per cent, while domestic sales dropped by 2 per cent during the same period, indicting a clear case of dumping. A probe was done in the imports of six Indian companies during the period from October 1, 1998 to September 30, 1999. The total value of imports from India and Korea together has increased to 86,000 tones in 1998 from 16,000 tones in 1996. However, during the period, import prices were down by 31 per cent, says the EC document. The document says that Indian exporters undercut the prices by 6 to 7 per cent for over the last two years.
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