The Indian government is to launch a World Trade Organisation
(WTO) challenge to countervailing duties imposed by the USA on
certain steel products.
New Delhi has requested that formal consultations be undertaken
at the WTOs Geneva headquarters. If these fail and
that is to be expected then India will probably demand
that a WTO disputes panel be established to rule on whether US
countervailing duties on steel comply with world trade laws.
These laws allow tariffs, such as those India is protesting, to
be imposed when a country subsidises the manufacture and export
of a product to such an extent that its exporters can unfairly
undercut local producers prices in importing nations.
India [has] requested consultations with the USA under
the dispute settlement system, concerning the latters
countervailing duties on certain steel products, a source
at the WTO confirmed.
The US Department of Commerce last month imposed a preliminary
import duty of nearly 286% on Indian circular-welded,
carbon-quality steel pipe, based on such alleged subsidies.
We are currently reviewing the request, and will respond
to it in due course, a US trade spokesperson told Metal
Bulletin, but declined to give further details.
The main products exported to the USA from India are hot rolled
coil and saw pipes, because of the high cost of transporting
steel products, according to Arun Kejriwal, director of
Kejriwal Research & Investment Services and a steel
industry specialist based in India.
The major exporting company is Essar Steel, a private company,
The Indian government will make a strong case at the WTO,
asserting that the US claims are incorrect, Kejriwal said.
However, the US government has already gone on record as saying
that India has a wide range of subsidy schemes to reduce the
price of its steel exports.
The US International Trade Commission released a report last
December listing many of these. Examples cited include steel
development fund loans, duty-free imports of manufacturing
inputs, tax breaks for fuel purchases, and others.