Deferring Imposition of Retaliatory Duties

Why in news?

• India recently confirmed its plan to slap retaliatory duties on some US imports by June, 2018. Click here to know more
• It has now notified to put off the implementation by a month-and-a-half to August, 2018.

What is the significance?

• Diplomacy - Postponing the levy of retaliatory duties would offer space for resolution.
• Discussions are planned with a visiting team from US Trade Representatives' (USTR) Office.
• Ways to bring down trade tension between the two countries would be discussed.
• Imposing retaliatory duties at this time may undermine the purpose of the meeting.
• Trade - US happens to be one of the largest export destinations for India.
• Despite the increase in exports from the US to India in 2017-18, India has a robust bilateral trade surplus.
• So, it is economically rational for India to maintain this and solve the tariff issue amicably.

What is the way forward?

• Clearly, India has only deferred the imposition, not ruled out.
• India now needs to do focus on convincing the US to roll back the additional duties imposed on Indian aluminium and steel.
• India should also not miss out the path of retaliation by other WTO members, including China, the EU and even Turkey.

Source: BusinessLine