India’s Import Substitution on Electronics becomes object of Objection around the World

The EU, Japan, and the US have objected to India’s move of raising import duties on mobile phones, TVs and projectors.

172

The EU, Japan, and the US have objected to India’s move of raising import duties on mobile phones, TVs and projectors. They have sought an explanation from India at the World Trade Organization (WTO) as under the Information Technology Agreement (ITA) signatories can’t impose import duties on many IT products including mobile phones.

Last month, India had raised customs duties on mobile phones, TV sets, digital cameras, microwave ovens, LED bulbs and a number of other electronics goods to boost local manufacturing. “These countries have asked India for an explanation in the ITA committee,” said an official.

Earlier, both India and China came under fire at the WTO from many countries that wanted the two countries to fulfill their commitments under the WTO’s ITA. The government had imposed customs duty on mobile phones for the first time on July 1 to boost manufacturing in the country.

With last month’s notification, imported smartphones cost more with customs duty on them being increased to 15 percent while customs duty on television sets was doubled to 20% and LED lamps are charged with a 20 percent import duty.

However, Delhi is preparing for any likely dispute because if countries are dissatisfied with India’s explanation, they may drag the country to dispute settlement at the WTO post which a panel would decide whether India bent any rules.

LEAVE A REPLY