Even as India’s challenge at the World Trade Organisation (WTO) against the US’ additional tariffs on steel and aluminium remains active, New Delhi has also initiated bilateral discussions on the matter, which is expected to be raised during a meeting next week, a senior official said.
India approached the WTO earlier this month, seeking consultations under the dispute settlement framework after the US imposed additional tariffs of 25% on imports of steel and aluminium starting March 12. The request for consultations marks the first formal step in the WTO dispute resolution process, aimed at reaching a bilateral settlement. If talks for mutual settlement fail, India can escalate the case by requesting the formation of a dispute settlement panel that has the power to adjudicate on the dispute.
In its response to India’s WTO complaint, the US contended that the additional duties were not “safeguard measures” but were implemented under its national security law.
“These actions are not safeguard measures and, therefore, there is no basis to conduct consultations under the Agreement on Safeguards with respect to these measures,” the US said in its response. However, Washington also expressed willingness to resolve the issue bilaterally and engage in discussions on “any other issue regarding trade and tariffs”.
The recent dispute mimics the earlier episode of US imposing extra duties on steel and aluminium in 2018 when the first Trump administration was in office. India has retaliated to these duties in 2019 by imposing additional tariffs on imports from the US of almonds, apples, chickpeas, lentils, walnuts, boric acid and diagnostic reagents among 21 other products. Both the impositions were challenged at the WTO by the opposite party.
In 2023, during Prime Minister Narendra Modi’s visit to the US under President Joe Biden’s administration, the two countries agreed to withdraw all ongoing WTO disputes, including those related to steel and aluminium tariffs and India’s retaliatory measures. A total of seven WTO cases were mutually resolved.
Other disputes at the WTO between the two countries were Countervailing Measures by the US on Certain Hot-Rolled Carbon Steel Flat Products from India. The US filed against Certain Measures Relating to Solar Cells and Solar Modules by India and Certain Measures Relating to the Renewable Energy Sector.
One dispute involved a complaint by the US against export incentive schemes by India. In one case the US complained against Certain Measures on Steel and Aluminium Products and in a same way India had raised the issue of Additional Duties on Certain Products from the US.